By now most investors and avid readers of business news would have seen the popular purple-ish and white colors of Stocks and Securities Ltd either in the papers or somewhere else. And if you’re not careful, you would probably think that this newly created capital markets company is on fire. But what is more unknown is the fact that this now booming IPO-arranging company has been around for ages…decades. So the question is then, why is it that they’ve only now just starting to create a splash in the IPO market…after all these years?
Having been around for over 40 years, since 1973, and being Jamaica’s 2nd oldest stock brokerage company nobody would have thought that SSL would only now be doing its 5th Initial Public Offering (IPO) listing in 2013. In fact, you would have thought that by now SSL would have been
a the household name for Initial Public Offerings and anything related to the stock market in Jamaica. So it was quite interesting hearing Mark Croskery, President and CEO of SSL telling his side of the story in this 2012 video about how they persevered to get to where they are today.
It may not be so obvious, but those in the investing world know that having an IPO under your belt is probably synonymous to having that young baby prince if you were Prince William and Catherine, Duke and Duchess of Cambridge. It just takes a lot of burden of your shoulders, eases the pressure, and cements your standing with the masses. So with no IPOs under its belt up to early 2011, you could quickly realize that SSL had to set out to changes this trajectory. However, as they soon realized, getting that very first initial public offering (IPO) required more strategizing than they thought!
Getting That Very Very First Client… Harder Than You Think!
Simply put, it took ALOT of work to get that very first client. Based on this 2012 promotional video you can even see the pride and joy on their faces from their IPO slaying exploits as they explain how much it took. For them, their strategy involved
- breaking down the who’s who of business – the owners (or principals) of the different companies,
- booking presentations with them, and
- doing that over and over again…
before finally convincing their very first customer.
The lessons in it for us are clear, but I will reiterate them for you!
Lesson #1 – Plot Your Path
These guys had to decide on their potential targets, the approach they would take, expected return, and manage their expectations even before making the very first call.
Lesson #2 – Go In Big
There was no second guessing their strategy after that. Once they had the approach, it was now to e-x-e-c-u-t-e! They did over 200 presentations before finally winning their very first IPO for AMG Packaging Ltd to raise J$57.8 million. We all know this was offering was a huge success and they ended up raising over J$200 million which put them on a winning warpath afterwards.
Lesson #3 – Keep Swinging
After their first victory it got much easier I’m sure. It all starts with the first step. It’s the art of the start. Once you start you and much better off for it, and that is the big lesson you should take away from this. While we don’t know why they weren’t doing IPOs before and how long they tried to get in on the game, the point is, the overcame this hurdle.
2013 – 5 IPOs Later
Fast forward to July 2013, and now the company is closing, its fifth IPO, which was hugely successful and has further helped to cement its place as a successful lead broker and arranger of market issues.
At 4 pm on Monday July 8, 2013, the offering of shares for the Jamaica Stock Exchange’s IPO was closed and it was later announced that the Invitation for sale and subscription of the JSE shares was oversubscribed by 41% and in excess of 150 applications were received! The IPO was only opened 1 business day ago, Friday July 5th 2013 at 9 a.m.
There was something even more special about this IPO, it was the company’s first main market listing (as all its previous listings were for the Junior Stock Exchange), another proud moment I’m sure. The company will take it to another level later this year when they will hopefully list Jamaican Tea’s Corporate Bond Offering which if all goes well will be the first for the newly created JSE Bond Market.