An aerial view of a phase of the Freeway 2000 East-West. NROCC has supplied its remaining 20 per cent stake within the firm to potential shareholders for $9 billion.
JAMAICA’S Nationwide Street Working and Setting up Firm Restricted (NROCC) has launched a public providing to divest its remaining 20 per cent stake in TransJamaican Freeway Restricted (TJH), operator of the nation’s key toll highway, Freeway 2000 East-West.
The supply on the market (OFS), valued at $6.3 billion (US$39.9 million), will open on March 4, 2025, and shut on March 18, 2025. Priced at $3.60 or US$0.0228 per share, the sale provides as much as 1.75 billion shares, with an choice to upsize by a further 750 million shares if oversubscribed which might enhance the yield to $9 billion ($57 millon). A totally subscribed supply would lead to NROCC’s possession in TJH being diminished from 20 per cent to zero. The proceeds are earmarked to cowl bills associated to the supply and for different makes use of decided by NROCC in session with the Ministry of Finance.
Alston Douglas, chairman of NROCC’s board of administrators, described the OFS as a “historic alternative” for Jamaicans to spend money on a essential nationwide asset. “This divestment aligns with our imaginative and prescient of broadening public possession whereas guaranteeing sustainable development for certainly one of Jamaica’s most essential infrastructure tasks,” Douglas stated in an announcement.
The divestment represents the ultimate section of NROCC’s technique to switch possession of TJH, operator of Jamaica’s Freeway 2000 East-West toll highway, to the general public. The freeway serves as an important financial artery connecting Kingston to suburban hubs comparable to Could Pen and Portmore. With this sale, NROCC goals to generate funds for nationwide improvement whereas offering retail and institutional traders a chance to personal a stake in one of many Caribbean’s largest infrastructure property.
Prime Minister Andrew Holness indicated in his keynote deal with on the twentieth Regional Investments and Capital Markets Convention hosted by the Jamaica Inventory Alternate (JSE) in January that the divestment was imminent.
“The Authorities will quickly be divesting 20 per cent holding in TransJamaican Freeway Restricted held by way of Nationwide Street Working and Building Firm Restricted. This shall be undertaken by a public supply on the market. That’s one thing that the capital markets can sit up for,” said Holness.
Transjamaican Freeway Restricted (TJH) efficiently raised $14.1 billion within the largest preliminary public providing (IPO) on the Jamaica Inventory Alternate (JSE) in a suggestion in February 2020. The IPO additionally attracted a file variety of new traders, with 31,624 shareholders collaborating within the providing.
TransJamaican Freeway Restricted (TJH), included in 2001, operates Freeway 2000 East-West beneath a 35-year concession settlement with NROCC. The freeway spans 49.9 kilometers and connects Kingston to Could Pen and Portmore, serving as Jamaica’s solely high-speed roadway linking the Better Kingston Metropolitan Space to suburban cities. TJH’s operations are managed by way of its subsidiaries, Jamaican Infrastructure Operators Restricted (JIO) and TransJam Freeway Operators Restricted (TJHO), which oversee toll assortment and upkeep.
The corporate plans to increase the freeway community and add new entry factors to enhance connectivity. It has already obtained approval to accumulate the concession for Section 1C of Freeway 2000 –Could Pen to Williamsfield — for US$20.3 million, topic to contract finalisation.
Since its preliminary public providing in 2020, TJH has made important strides in increasing its operations and bettering effectivity. Notably, it acquired JIO in 2022 to scale back operational prices related to toll assortment and upkeep. The corporate has additionally applied technological developments comparable to automated toll programs and piloted modern fee options like WhatsApp-based top-ups, additional enhancing consumer comfort and operational profitability.
TJH has demonstrated constant income development pushed by annual will increase in site visitors volumes and inflation-adjusted toll charges. This sturdy money circulation has enabled the corporate to take care of common dividend payouts to shareholders. Its dividend coverage prioritizes maximizing distributions whereas guaranteeing enough reserves for operational wants and compliance with monetary covenants.
The corporate additionally faces potential monetary pressure from main upkeep bills required beneath the handback provisions of its concession settlement. Upon the expiration of the concession in 2036, TJH should return the toll highway to NROCC in a specified situation. This might require substantial expenditures for repairs and upgrades, impacting money flows and compliance with reserve necessities.
TransJamaican Freeway Restricted (TJHL) reported a 30.7 per cent rise in internet revenue to US$31.3 million for 2024, pushed by a ten.1 per cent enhance in toll collections to US$82.8 million1. The corporate’s EBITDA margin expanded to 80.3 per cent from 78.8 per cent in 2023, reflecting operational effectivity good points, whereas earnings per share climbed to US$0.0025 from US$0.00191. Progress was fueled by increased site visitors volumes and annual toll tariff changes beneath its 35-year concession for Jamaica’s Kingston-Portmore-Could Pen highway1. The debt service protection ratio improved to three.04x, signalling sturdy capability to fulfill obligations.
Traders can apply by way of platforms like GoIPO or JMMB Moneyline.
