5 months ago
25
Omni Industries Limited, a maker of PVC plastic pipes and crates, is floating its shares on the market to raise $500 million to finance the company’s expansion and modernisation agenda.
“This IPO and offer for sale will also allow us to deepen our roots in existing markets and stretch our branches into new regions and industry sectors,” said Omni’s Managing Director Patrick Kumst.
The company will sell 500 million shares at $1 each via the junior market of the Jamaica Stock Exchange. NCB Capital Markets Limited is the lead broker and arranger for the offer, which will be on the market from May 17 to 31.
The company plans to use the funds to retool and buy new machinery and provide working capital for the business. It retired debt last year while preparing to come to the market for fresh equity. Consequently, its debt ratio was more than halved from 142 per cent of capital to 62 per cent.
The largest shareholder is Chairman Von White, who holds 42 per cent interest, followed by the Kumst family, also with 42 per cent but split among five members. Patrick Kumst holds 17 per cent. A successful IPO would dilute White’s ownership to 38 per cent and Patrick Kumst’s to 15 per cent.
The company was founded in 1974 by the late Uwe Kumst, a German entrepreneur in Jamaica. The company initially decided to focus on producing garden hoses. It quickly gained market share based on the product’s reliability and what the company called its German engineering standards. Omni eventually expanded to larger products and moved from consumer goods to industrial supplies, including PVC electrical conduits and pipes.
During the early stages of the company, White partnered with Uwe Kumst to run the business.
Omni initially operated from Retirement Crescent in Kingston but eventually moved to Twickenham Park in Spanish Town, its current home base, from where the company says it services a diverse clientèle of “1,800 customers”, spread locally and abroad. The location spans over seven acres, with a 130,000-square foot warehouse.
A fully subscribed IPO would give Omni a valuation of $2.5 billion on the stock market, or four times its book value of $574 million.
Omni’s total income at $2 billion for 2023 has grown at a compounded rate of five per cent since 2019. Its profits were flat at $151 million last year but twice levels achieved in 2019 when its earnings amounted to $73 million.
English (US) ·