Reorganisation complete
Securities dealer Mayberry Group (MGL), which recently finalised its reorganisation plans, also revealed that it holds $240 billion in funds under management (FUM) or more than tenfold higher than earlier stated levels, as the figure now includes funds from its clients.
The revelation of its client funds along with its own portfolio puts the company at roughly 15 per cent of the FUM market.
“They only used funds in the managed portfolio. This number now includes all the customer assets in our custody,” said Mayberry CEO Gary Peart in response to Sunday Business queries.
He added that it now includes assets held on behalf of clients, including equities and bonds at the Jamaica Central Securities Depository (JCSD). The $240 billion in FUM was disclosed in a notice to shareholders on December 11, when it gave an update on its listing and reorganisation. A year earlier that figure would have been about $200 billion, reasoned Peart, on a comparative basis.
This latest figure gives Mayberry some 15 per cent market share when compared to the $1.53 trillion in FUM across the entire sector, according to the latest industry data from the regulator Financial Services Commission.
Earlier this year, Mayberry put its FUM at “$19.5 billion” in its scheme of arrangement booklet.
At the onset of the pandemic in 2020, which led to market fluctuations, Mayberry’s FUM stood at $20.5 billion, according to financials.
“It was not previously included,” Peart added about client funds.
Mayberry’s staff of roughly 110 serves over 30,000 customers, according to the update.
The company gained an uptick in its customer base since around 2009 when it started listing companies on the junior arm of the Jamaica Stock Exchange (JSE). Currently, it has listed the “majority” of the companies on the junior market.
According to the company’s site, clients are required to open an account with a minimum of “$1 million”. However, exceptions may apply to promotions and initial public offerings (IPO) – the process of taking a private company to the public market.
Before the reorganisation, Mayberry Investments Limited (MIL) was the ultimate parent company of the Mayberry Group of companies. That ultimate parent designation now goes to MGL with the completion of the reorganisation. The Mayberry Group includes MIL and its subsidiaries Mayberry Jamaican Equities in which it has 50.4 per cent ownership, and Widebase, which it owns 100 per cent.
MGL shares started trading on the JSE on December 13. The listing of MGL resulted in the de-listing of MIL from the JSE Main Market.
It also resulted in the cancellation of those shares by the Jamaica Central Securities Depository. Those shares were then replaced with the new stock units in MGL.
“The JCSD accounts of MIL stockholders will be appropriately debited and credited,” the statement indicated.
MIL stockholders with shares in MIL automatically received MGL shares upon cancellation. Anachronistically, those shareholders holding physical MIL share certificates are requested to return them to MIL for cancellation, the company said.
In July, Mayberry got shareholder approval for its plan. In September, the Supreme Court gave its approval to the new scheme of arrangement.
The restructuring aims to separate the group’s regulated operations from its non-regulated businesses to give itself flexibility in fundraising and other matters.
“The reorganisation will not only ensure that the Mayberry Group is compliant with the regulatory regime in Jamaica and international best practice in the regulatory sector. The reorganisation will also place the group in a better position to expand and take advantage of value-creating opportunities. This will ultimately benefit us all as stockholders of Mayberry Group Ltd, the new parent company of the group,” stated Christopher Berry, executive chairman of MIL in a December 11 update on the transaction.
From July to September this year, MIL reported a loss of nearly $1 billion in the quarter mainly due to the downturn in the asset values of its investments, arising from the continued decline of the stock market in which Mayberry heavily invests.
It also recorded a loss of $1.2 billion in the similar quarter of 2022. That said, Mayberry’s capital stands at a robust $24.5 billion.
Jamaica’s stock market is struggling to return to the pre-pandemic period when it was twice named as the world’s best performing market. Year to date, the market is down some 11 per cent.