Guardian Holdings Ltd (GHL) and the International Finance Corporation (IFC), a member of the World Bank Group, on Thursday reached an agreement to invest $473 million in the common equity of the Group at $16 per share. In a statement, GHL said the investment in GHL will strengthen its capital base and support the company's strategic regional expansion. "The price per share at which the IFC is investing represents a 6.6 per cent premium over yesterday's (Wednesday) closing price for the company as quoted on the T&T Stock Exchange, and a 17 per cent premium over GHL's 30 day moving average price of $13.65," GHL stated.
"The agreement includes converting IFC's current US$50 million ($315 million) subordinated loan into common equity while at the same time investing US$25 million ($158 million) of new capital into GHL. "The transaction will significantly improve GHL's debt to equity ratio. Post completion of this transaction, IFC will own approximately 13 per cent of the outstanding share capital of the Group. Giri Jadeja, senior manager for IFC financial markets, said, "We are very pleased to strengthen our existing partnership with Guardian through this equity investment and look forward to working closely with the company as they grow their current businesses and look for potential growth opportunities in the Caribbean and Central America.
"Guardian's strong track record, diversified business lines and wide reach in the Caribbean provide the IFC with an excellent platform to deepen insurance penetration and achieve strong development impact in the Caribbean and beyond." Jeffrey Mack, Group chief executive, said, "IFC's investment is a vote of confidence in GHL, especially when one considers that the IFC is transforming their current secured debt position into an unsecured equity position. Plus, at the same time, they are investing new equity into our Group. "This demonstrates their belief in not only how we currently operate, but also in our future plans for strategic growth. They will be a key partner for us as we grow and diversify our operations in the region."