SFC’s proposed debt issue gets ‘high creditworthiness’ ratings

August 2nd, 2019

CariCris Press Release

MEDIA RELEASE

July 29, 2019

SFC’s proposed debt issue gets ‘high creditworthiness’ ratings

Caribbean Information and Credit Rating Services Limited (CariCRIS) has assigned initial credit ratings of CariAA (Foreign and Local Currency Ratings) on its regional rating scale and jmAAA on the Jamaica national scale, to the proposed debt issue of Sagicor Financial Corporation Limited (SFC) of up to US $76 million or the Jamaican Dollar equivalent.  The regional scale foreign and local currency ratings indicate that the level of creditworthiness of this proposed debt obligation, adjudged in relation to other obligations in the Caribbean is high. The Jamaica national scale rating indicates that the level of creditworthiness of this obligation, adjudged in relation to other debt obligations in Jamaica is the highest.

SFC’s ratings reflect the Group’s leading market position in the Caribbean with a growing market share in international markets as well as its healthy financial performance, good capitalization levels and adequate short-term liquidity metrics.  The Group’s strong and effective Enterprise Risk Management framework also supports the ratings.  These rating strengths are tempered by SFC’s exposure to weak economic conditions in some of the countries in which its subsidiaries operate.

CariCRIS has also assigned a stable outlook on the ratings. The stable outlook is based on CariCRIS’ expectation of continued revenue growth and profitability for SFC over the next 12 to 15 months.  This will be supported by continued strong performance in Sagicor USA and Alignvest’s[1] US $450 million capital injection which will bear favourably on the Group’s capital adequacy.


About the company

Sagicor Financial Corporation Limited (SFC) was formed through the demutualization of Barbados Mutual Life Assurance Society through an initial public offering on the Barbados Stock Exchange in 2002. The Group, which was previously domiciled in Barbados, redomiciled in Bermuda in 2016 and currently operates in 19 countries across the Caribbean, USA and Latin America.

SFC, through its subsidiaries, offers individual life, health and annuity products, group life and benefits administration, banking and investment management services, and property and casualty insurance, amongst other services.  In 2018, SFC derived its total revenue from Jamaica (38%), the United States of America (28%), Barbados (11%), Trinidad and Tobago (11%) and other Caribbean territories (10%).

SFC and Alignvest Acquisition II Corporation (Alignvest) announced on November 27, 2018, that they entered into a Scheme of Arrangement in which Alignvest will acquire all the shares of SFC by way of a scheme arrangement under Section 99 of the Companies Act of Bermuda. Following the execution of this arrangement, SFC will continue to operate as before, with the added benefits of a US $450 million capital injection and a listing on the Toronto Stock Exchange.  Consequently, SFC will de-list from the Barbados, Trinidad and Tobago and London Stock Exchanges. The listing on the Toronto Stock Exchange is expected to expand Sagicor’s access to capital and facilitate more accurate price discovery for its shares.

SFC is seeking to issue a combination of USD and JMD debt in Jamaica, with total proceeds not exceeding US $76 million or the JMD equivalent.  The facilities will be of short tenors (13 months) with fixed rates and bullet repayment of principal upon maturity. 

For more information on the ratings of Sagicor Financial Corporation Limited, please visit www.caricris.com  or contact:

 

Andre Joseph                                           OR                  Kathryn Budhooram

Senior Manager, Ratings                                                Manager, Ratings

Tel: 1-868-627-8879 Ext. 224                                           Tel: 1-868-627-8879 Ext. 227

E-mail: [email protected]                                        E-mail: [email protected]


Note

This press release is transmitted to you for the sole purpose of dissemination through your agency/newspaper/magazine. You may use this press release in full or in part without changing the meaning or context thereof, but with due credit to CariCRIS.  CariCRIS has the sole right of distribution of its press releases, for consideration or otherwise, through any media, including websites, portals, etc.

[1] Alignvest is a Toronto-based Special Purpose Acquisition Corporation (SPAC). On June 4 2019, SFC completed a definitive agreement with Alignvest by which Alignvest would acquire all the shares of Sagicor by way of a scheme of arrangement under the laws of Bermuda.

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