Portland adds more to Diverze holdings:
PORTLAND CARIBBEAN Fund II, which is managed by Portland Private Equity, has acquired additional shares in Diverze Assets Inc, the holding company for Chukka and Tropical Batteries, owned by the Melville family.
Portland JSX Limited, another company controlled by Michael Lee-Chin, disclosed in its newly released annual report that it participated in the transaction, which was completed in the March quarter, and that its share of the investment was US$271,958.
Diverze holds a 40 per cent
US$10 million and includes an incident-response service; privacy and network security liability; privacy regulatory stake in Chukka Caribbean Adventure Limited; 100 per cent of Tropical Batteries Company Limited; and 100 per cent of Diverze Properties Limited.
Last year June, Diverze received US$8 million of financing from Portland in a deal structured to allow Portland to
defence and penalties; digital media liability; network interruption and loss of income coverage; and coverage for cyber extortion.
The total package also includes assistance with public relations to repair the company’s image. All services are provided by the international reinsurer.
“When you get hacked, the timer is running, telling you how much time you have to pay the ransom. You can call this service and they tell you what you need to do,” she added. The service referenced is the call centre operated by Key’s reinsurance partner.
Cyber is a new area of risk make additional investments in the company.
Portland Caribbean Fund II raised US$200 million in 2016 for investments across the region. As at March 2018, the fund had completed seven investments in seven companies.
The investments include
coverage for Key.
“I actually searched for this product for about a year. I met with Lloyd’s and it was cost prohibitive for small companies, [with] minimum payment of US$10,000. So when you translate that into Jamaican dollars, that’s probably more than the budget for insurance for the entire year,” said Masterton.
The solution came through a reinsurance provider – whom she declined to name – with a product backed by four Lloyd’s syndicates.
Key’s Chief Financial Officer, Jacqueline Johnson, indicated that the company Key is not expecting to see any significant Diverze, at least US$8 million; CVBI, a company associated with Liberty Global, US$30 million; IEH Penonome Holdings, US$15 million; Clarien Group Limited, US$10 million; InterEnergy Holdings, US$25 million; Grupo IGA, US$17 million; and Productive Business Solutions at US$15 million.
Portland JSX is a limited partner in Fund II and a listed company on the Jamaica Stock Exchange since 2016. take-up of the cyber product before 2019. For this year, she said, Key would focus on building awareness about the product.
“As we have seen in the insurance business, persons have to be aware before you actually see the results,” Johnson said.
Key Insurance first hit the billion-dollar mark for gross premiums in 2016 and bettered its performance last year by nearly $360 million when it collected $1.44 billion. The company also turned around losses of $42.2 million to net profit of $42.6 million.
However, Key had a bad first quarter, ending March 2018, when it reported losses of $40 million. The loss in the comparative 2017 quarter was $1 million.
Johnson said the quarter was characterised by underwriting weaknesses, which have been addressed.
“We have been looking at our claims processes and, also, we have been looking at our underwriting. As a team, we have seen where there are some downside aspects of the claims management process that we were focusing on. Based on what we have done on time, we have actually reversed some of these negative claims experience,” she explained to the Financial Gleaner.
She said the company expects to report improved results in the current quarter, which closes June 30. Those results would be due within six weeks of the quarter’s closing.
Key completed an operational review in 2017 which led to staff cuts, as well as process improvements.