Barita takes 20% stake in Derrimon

BARITA I NVESTMENTS Limited announced that it now owns 20 per cent of Derrimon Trading Company Limited, a stake valued at $2.3 billion at present market value.

Barita now holds the second largest position in Derrimon, behind founder Derrick Cotterell. The distribution company, which trades under the symbol ‘DTL’ on the junior arm of the Jamaica Stock Exchange, is capitalised at $11.6 billion.

At one-fifth ownership, Barita holds over 906 million of the 4.53 billion DTL shares in issue. The investment company would have acquired a good portion of those holdings on the open market. The opportunity to buy DTL shares presented itself in January when Mayberry Jamaican Equities decided to sell its holdings, but it’s unclear how much, if any, of those shares Barita might have acquired.

Barita was otherwise assigned 378.4 million shares under the additional public offering of shares, or APO, that Derrimon recently executed. As lead broker for the offer, which closed January 26, it had been willing to underwrite the APO up to a value of $3.5 billion, but didn’t have to as the offer was oversubscribed.

The size of Barita’s holdings in Derrimon classifies the distribution company as an associate of the investment firm.

“We welcome Barita,” Cotterell said on Friday. “We like their decisiveness. Their energy matches ours and we think we are compatible,” he told the Financial Gleaner.

Derrimon previously utilised Mayberry Investments Limited as financial adviser, but chose Barita for its second run at the market. Mayberry brokered the distribution company’s initial public offering, or IPO, back in 2013.

Mayberry Jamaican Equities, which is a subsidiary of Mayberry Investments, held 16 per cent of Derrimon going into the APO, and would have ended up with around 10 per cent on a diluted basis after the offer. Mayberry, however, decided t o sell its Derrimon holdings to willing takers while the APO was on the market.

Barita’s holdings now surpass the stake held by Mayberry. Cotterell held 40 per cent of the DTL shares prior to the APO, which was expected to dilute to 26.3 per cent following the offer, according to the prospectus.

Barita said it would respond to requests for more clarity on the investment in Derrimon, which was not forthcoming up to press time.

There is no word yet on whether the investment firm will gain representation on Derrimon’s board. “That’s a discussion for the future,” Cotterell said. was told by NCB that a fraud had been committed on her account and that she owed the bank $5 million. Steens was also informed by NCB that it was investigating Cunningham’s activities.

Prior to being informed by the bank about the fraud committed on her account, Steens said she was told by Cunningham that she was no longer employed to NCB and that she was being investigated by the bank.

She later collected $2.6 million from Cunningham for the sum that was borrowed, and subsequently cleared the NCB loan and closed her accounts.

The Court of Appeal, in overturning the lower court’s decision, ruled in the unanimous judgment handed down on February 19 that the trial judge was wrong to find that Cunningham had a fiduciary relationship with Steens, the respondent in the case.

“The trial judge also failed to properly assess the evidence in concluding that the advice given by the ex-employee to invest in the unregulated investment scheme was given in her capacity as personal banker to the respondent,” the appellate justices said.

The panel also held that the trial judge had failed to apply the correct test in assessing whether NCB should be held ‘vicariously liable’ – that is, held responsible for the civil wrong of another person – in the circumstances, and in so doing, failed to consider relevant factors which caused Steens to erroneously conclude that the conduct of the ex-bank employee was so closely connected to her employment that it was just to hold NCB to account.

The bank was represented by attorney Sandra Minott-Phillips, QC, and Steens by Lord Anthony Gifford, QC.

Steens has not indicated a desire to pursue the matter further, Lord Gifford said on Wednesday.