The North West Company has announced that it would have spent just under $40 million to control majority shares in Roadtown Wholesale Trading (RTT) located in the British Virgin Islands (BVI).
RTT is a privately-held company with seven retail outlets, one Cash and Carry, and one wholesale operation serving the BVI. It operates as RiteWay,
North West, which is a Canada-based firm with branches in various countries, hopes to rake in $5 million in profits annually from its venture in the BVI.
It explained: “Subject to the satisfaction of customary closing conditions, North West will pay approximately US$32 million for its 76% ownership interest in RTT, plus approximately US$5 million in acquisition-related costs, which include stamp duties to the government of the British Virgin Islands.”
“The acquisition, which is expected to close in early February 2017, is expected to contribute approximately US$5 million of annualized net income to North West. North West will pay approximately 90% of the purchase price [for RTT] in cash, financed through its existing credit facilities, and approximately 10% through the issuance of North West common shares, in accordance with the form of consideration elected to be received by RTT shareholders,” North West further said.
“The approvals required to operate RTT under North West majority ownership have also been obtained from the government of the British Virgin Islands, and the Board of Directors of both North West and RTT have unanimously approved the transaction.”
Peter Haycraft, founder and one-time majority owner of RTT, thinks North West is committed to the BVI.
“When we decided to sell this interest in our life’s work, we wanted to make sure that we partnered with a company that was committed to our customers, to our employees, and to the BVI.”
“North West is uniquely qualified in all of these respects and will bring enhancements to our business beyond what we could achieve on our own, especially within today’s changing retail environment,” added Haycraft.
North West, in the meantime, stated that the ‘landmark agreement’ brings together two long-standing retail companies to deliver more selection, services and value to ‘help Virgin Islanders live well’.
The company’s President and Chief Executive Officer, Edward Kennedy, said the local company will continue to operate under the trade names RiteWay Food Markets and Roadtown Wholesale Trading.
He added, “We are very pleased to join with Riteway Food Markets and Roadtown Wholesale Trading Limited and to become part of the BVI. Through this long process of working with RTT’s owners, government and other BVI stakeholders, we have gained an even greater appreciation of our opportunity to be a valued partner.”
Kennedy further stated that North West will prove it is a valued partner through:
• Offering a broader range of retail and wholesale products at better prices to attract more of the provisioning and other retail spending that occurs outside of the BVI
• Continuing to operate RTT under the trade names, RiteWay Food Markets and Roadtown Wholesale Trading
• Ensuring that BVI shareholders are well represented on RTT’s Board of Directors
• Recognizing the strength of BVI’s workforce by making RTT an administration center for North West
• Enhancing community support wherever possible and in consultation with all stakeholders
North West is a widely held publicly traded retailer that specializes in serving smaller countries and regions. Its retail presence in the Caribbean includes Cost-U-Less stores in Cayman Islands, Barbados, Curaçao, St Maarten, as well as St Thomas and St Croix in the US Virgin Islands.
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