Lee Chin

The pension fund of the light and power company, Jamaica Public Service (JPS), has built up a near four per cent stake in RJR Group, placing it among the top-10 shareholders in the broadcast media outfit.

However, National Commercial Bank, owned by Michael Lee Chin, remains RJR's largest-single shareholder, with just under eight per cent of the company.

The managers for the JPS Superannuating Fund would not immediately comment on the strategic reasoning behind their decision to build up a position that, at the end of March, made it RJR's sixth-largest shareholder.

Rez Burchenson, the general manager of Prime Asset Manage-ment which oversees the JPS pension fund's portfolio, was heading into a meeting yesterday, but suggested that he could address the issue in the future.

RJR Group's portfolio includes a raft of FM radio channels, a free-to-air TV station, as well and two cable television channels - one dealing with news and the other focusing on entertainment - which it bought last year.

The group's articles places a 10 per cent on shareholding in RJR, a hold-over from its days as a government-owned entity and efforts by the former People's National Party (PNP) government to prevent its narrow control when it was taken public in the late 1990s.

Currently, RJR's largest single shareholder, according to the group's just-released annual report, is Michael Lee Chin's National Commercial Bank (NCB) which, at March 31, owned 28,064,400 shares, or 7.79 per cent of the company.

Lee Chin's stake in Radio Jamaica Group was a mere 0.1 per cent more than that of Ideal Portfolio, a vehicle controlled by his close boyhood friend, Donovan Lewis.

Lewis also sits on the NCB board.

Top-ten shareholders

Notably, the Trade Union Congress (TUC) has dropped off the list of top-10 shareholders, underlining the slippage in the hold that mass-based organisation used to have on the media company, starting with its acquisition in the 1970s by the Government from Britain Redifusion Limited.

Lee Chin is also the major stockholder in the privately held CVM Group, where he was recently reported to have lifted his holding from 51 per cent to over 90 per cent.

CVM owns radio and television channels as well as a weekly, down market tabloid newspaper. Lee Chin also has a big stake in Flow Jamaica, the telecommunications and media outfit that offers subscribers cable television, Internet and telephone services.

However, Robert Almeida, a senior vice-president and and portfolio manager for Lee Chin's Canada-based parent company, AIC Ltd, insisted this week that Lee Chin ultimate intention was not, as is often rumoured, to grab a big stake of RJR, then corral it into a merger with CVM.

"NCB, not AIC, has the investment in RJR as part of its overall investment portfolio with the objective of generating attractive financial returns," Almeida said.

"The bank would not typically have any intention of becoming an active or controlling shareholder of a non-financial company," he said.

In the year to March 31, RJR reported after-tax profit of $41.6 million, a return per stock of 15 cents, a turnaround from the $32.4 million of losses made in 2006/07.

The performance comes at a time of leadership change within the group.

RJR Group's long-standing director, Lester Spaulding, recently announced that he was stepping down as CEO, making way for Gary Allen, the deputy he began grooming in 2006.

Spaulding has said he will stay on chairman of the group, having responsibility for special projects.

susan.gordon@gleanerjm.com