The McCanns, known for their association with Fyffes, are implementing an initiative to acquire complete private ownership of Balmoral International Land. Vehicles subject to their control would raise their total stake to nearly 80% in this transaction. Balmoral, having been delisted from the Dublin stock exchange since 2011, began dealing on the grey market managed by stockbroker firms. Last week, Balmoral proposed to its stockholders a compulsory repurchase of shares owned by investors with less than 25,000 shares, accounting for about 22.4% of the company’s stake.
The proposed transaction is tagged at €10.50 per share, which signifies a 110% premium compared to its most recent trading value on the grey market in November — before trading ceased due to paperwork complexities. Balmoral has affirmed that there is little chance of the company returning to the stock market in the foreseeable future. However, the proposed price only makes up 56% of Balmoral’s revealed net asset value (€18.72) per share as of the end of June.
The proposed compulsory buyback scheme, estimated to cost a total of €18 million, matches Balmoral’s present net cash standing. Consequently, the scheme will upsurge the McCann families’ direct and indirect stakes, via vehicles under their control, from just over 61% to an aggregate of 79%. Balmoral has an unusually high number of shareholders for a company of its size, with nearly 5,000, or 95% of total investors, holding less than 500 shares each.
Many shareholdings are minor and trading has been uneconomic for a while. Balmoral’s chairman, Carl McCann, said the company constantly fields enquiries from shareholders who want to explore options to liquidate their stock value, now that there isn’t an active market for the company’s shares.
McCann added that Balmoral has already returned €2.6 million to its shareholders in 2023, and after selling off additional property this year, the group now possesses a net cash balance. As of 30 September 2024, the company’s gross cash totalled €47.5 million against €29.5 million in debt, leaving a net cash total of €18 million.
A special general assembly will convene on November 21st at Arthur Cox, the Dublin-based legal representatives of the company, to discuss and approve a particular issue. Nevertheless, this appears to be just procedural as Balmoral has confirmed that over 80% of stakeholders have provided “irrevocable promises” to support the deal.
Formerly known as Blackrock International Land, the firm was spun off by Fyffes in 2006 as an individual stock market-listed entity. Following a drop in its stock price amid the property market crash, the company was delisted in 2011. However, thousands of legacy investors have kept their positions since exiting the stock market.
In 2017, the McCann family sold their long-held Fyffes shares to Japan’s Sumitomo corporation. The Tokyo headquarters thereafter disposed of the inherited 30 per cent stake in Balmoral to a group spearheaded by the McCanns.
Furthermore, the McCanns’ executive chairman holds the same position at Dole Plc, an Irish-based, New York-listed fresh goods enterprise formed in 2021 by merging Dole Foods and the former Total Produce. Both Dole and Fyffes are Balmoral’s prime leaseholders.
Balmoral saw a rise in the value of its investment portfolio – comprised of mixed-use land, offices, warehouse and industrial buildings – to €146.3 million in June from €138 million in the preceding December, according to the company’s circular.