Move still on

Sagicor to shift its headquarters by the end of March 2016

With Barbados’ economic rating not expected to return to investment grade any time soon, Sagicor Financial Corporation is moving forward with plans to relocate its headquarters by the end of the first quarter of next year.

Group President and Chief Executive Officer Dodridge Miller revealed during a news conference conference today that three countries had been shortlisted, namely the United Kingdom, Trinidad and Bermuda.

He said the decision to move its base out of Barbados was driven by a number of factors, including the sustainability of the rating of those countries, the taxation impact on shareholders, the ease of the process to re-domicile, the ability to move funds across different geographies and legislation.

Miller said that by the middle of next month the analysis of the three jurisdictions should be completed and submitted to the company’s board of directors.

It will then have to be presented to shareholders in a special meeting, following which a decision will be made.

He said the process was a complex one and could take at least a year to be completed.

Group President and Chief Executive Officer Dodridge Miller
Group President and Chief Executive Officer Dodridge Miller

“We estimated that this will be completed by the first quarter of 2016. It is not a trivial process and it is not something we walk into lightly,” he said, adding that Sagicor had received “offers” from “lots of countries” to facilitate the process.

Last year, Standard and Poor’s (S&P) lowered the company’s rating from BB+ to BB-, only weeks after it had lowered the island’s rating to B from BB-.

This prompted Sagicor to announce its intention to move its headquarters, which has been met with lots of criticisms and concerns.

In its assessment, S&P had informed Sagicor that its rating could be upgraded if it completed plans to relocate to a country which was at least investment grade, had strong regulations and adequate access to funding.

During the joint media conference involving journalists from Barbados and Trinidad, Miller said he did not see Barbados’ economic rating returning to investment grade in the short term, adding that re-domiciling to a country with A rating could raise the company’s rating back to BBB.

“We have to refinance our bond in 2016. We also need access to capital to fund for our future growth opportunities and a strong rating is important for this process,” said Miller.

“We believe that without operating performance and the continued improvements in the Jamaican economy and moving ourselves to an A-rating jurisdiction we can get our ratings back to investment grade at least BBB,” he said, while stressing that re-domiciling would not negatively impact the insurance operations or policyholders.

He said the move was “a fundamental decision” that had to be done carefully.

“Management and board owe it to the shareholders to do the best possible analysis to present a solid case to re-domicile and we are doing just that,” he said.

“There is a price to pay if you get it wrong. You made the recommendations and then some years down the road you have not achieve what you wanted to achieve and then you have to re-domicile again. So this is a fundamental decision we have to do it right,” he stressed.

Miller agreed that if the headquarters was moved to an extra-regional location, there may be a negative perception among some residents but he was confident that “soon after” that perception would “disappear”. He suggested there was similar sentiments when the company moved from being Barbados Mutual Life Assurance to Sagicor.

One Response to Move still on

  1. Patrick Blackman May 1, 2015 at 5:02 pm

    There is a hidden agenda, look at the shareholders and you will find the answer. (BIS, IMF, World Bank), there are stripping this company.


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