Jamaican Government Moves Forward with $10-Billion Divestment Plan to Boost Public Ownership and Market Participation

The Jamaican Government is set to move forward with a significant divestment strategy, which will see the sale of its $10-billion stake in TransJamaican Highway Limited (TJH), the operator of the East-West toll roads of Highway 2000. The government, through the Jamaica Stock Exchange (JSE), will also outsource assets managed by the Port Authority of Jamaica (PAJ) later this year, as outlined by Prime Minister Dr. Andrew Holness during the 20th JSE Regional Investments & Capital Markets Conference.

Dr. Holness emphasized that the government’s aim is to increase public ownership of state assets through the stock market. As part of this effort, the government will divest its 20% shareholding in TransJamaican Highway Limited, which is currently held by the National Road Operating and Constructing Company Limited (NROCC). This divestment will be facilitated through a public offer for sale. The Prime Minister highlighted that this is a move the capital markets can look forward to, offering opportunities for more Jamaicans to own a part of this vital infrastructure asset.

TransJamaican Highway Limited, which first listed on the stock market in March 2020, has experienced significant growth, with its stock value tripling since its debut. As of now, the company’s market capitalization stands at nearly $53 billion, with the share price trading around $4.22. The 20% stake held by NROCC, comprising 2.5 billion shares of the total 12.5 billion shares, is valued at approximately $10.55 billion.

The company, which holds a 35-year concession for the East-West toll corridor, has seen its assets valued at around US$297 million as of September 2024. In 2023, TransJamaican Highway reported toll collections of US$75 million, with over US$60 million generated from January to September 2024 alone, marking a 9% increase year-over-year. Net profits for the year 2024 are expected to surpass US$24 million, building on the company’s strong financial performance.

In addition to the highway operator, the government has plans to divest the PAJ’s outsourcing assets through the JSE. The assets, valued as part of PAJ’s total holdings of approximately $82 billion, include prime properties in special economic zones in Montego Bay and the Portmore Informatics Park. These assets will be managed under a new entity, ‘Newco,’ which will eventually be listed on the JSE as well.

These divestments are part of the Jamaican government’s ongoing strategy to utilize the capital markets for public ownership. Previous offerings, such as the Wigton Windfarm listing in 2019 and TransJamaican Highway’s listing in 2020, have attracted thousands of new investors to the stock market. Wigton Windfarm, which debuted at $0.50, now trades around $1.30, with a market valuation of $14.6 billion.

Looking ahead, the government is considering further divestments, including the Jamaica Mortgage Bank and its nearly 20% stake in Jamaica Public Service Company Limited (JPS). These initiatives align with the government’s broader strategy to boost public confidence and encourage participation in Jamaica’s capital markets.

Dr. Holness also addressed broader economic performance, highlighting how positive economic indicators are translating into better living conditions for Jamaicans. Confidence indices in both consumer and business sectors have seen notable improvements, signaling a continued upward trend in economic sentiment. This economic progress, he noted, has been driven by better perceptions of business conditions, job prospects, and income growth, despite the challenges posed by inflation and natural disasters like Hurricane Beryl.

Through these initiatives, the Jamaican government is reinforcing its commitment to fostering economic growth, increasing public participation in the financial markets, and driving further advancements in the nation’s overall economic development.

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