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"As far as the Caribbean is concerned - and this does not apply to just Jamaica, cruise ships and all-inclusive hotels do not allow for economic dispersion. It shouldn't be the case that the majority of tourists get herded onto site and the tourism dollar does not trickle down into the communities and to local entrepreneurs. There is something wrong with that picture. We need a type of tourism that differentiates the region and sells indigenous services", said Lee Chin. [img]/forums/images/graemlins/70402-thinking.gif[/img] man a talk truth still
Chairman of Canadian mutual fund company AIC, Michael Lee Chin, who is also the chairman of Jamaican banking house NCB Group, continues to extol the investment opportunities the Caribbean holds.
He has practically single-handedly returned confidence to the Jamaican business sector with a number of investments dating back to 2002 when AIC acquired a majority interest in NCB. He then followed up with interests in Dyoll, the Mutual Life Towers, Kingston Wharves, Reggae Beach, the Trident Hotel, United General Insurance, and CVM. To date, Lee Chin has invested Can$1 billion in Jamaica and is now looking to the wider Caribbean.
Committed to investing in the Caribbean
To underscore his commitment, he is spearheading the AIC Caribbean Fund. Last month the Overseas Private Investment Corporation (OPIC) loaned AIC US$80 million to assist in the building of this Caribbean private equity investment fund.
The AIC Caribbean Fund will make investments in businesses located in countries of the Caribbean Community (CARICOM), with an emphasis on Jamaica, Barbados and Trinidad & Tobago. The fund will focus on the tourism, telecommunications, healthcare, energy, and financial services sector, and has a target capitalisation of US$250 million.
Over the last year analysts, business writers and observers have seen no clear pattern to Lee Chin's acquisition strategy; some even fear that he may become over-leveraged.
Speaking with Caribbean Business Report from AIC's headquarters in Hamilton, Canada, Lee Chin sought to explain his Caribbean strategy: "There are some 80 million Americans coming up for retirement and five per cent of those (four million) will be looking to the Caribbean because of its warm weather and proximity to the United States.
Already, the coastlines of North Carolina and Florida are saturated. Therefore, I expect to see four million retirees superimposed on an English-speaking Caribbean population of eight million.
"So what are the services these retirees will be requiring? We have earmarked financial services, health care, telecommunications, real estate and entertainment."
Method to the madness
Expanding further on this thinking, he said that the Caribbean's proximity to the United States means that it has a vested interest in making the region safe, and also the Caribbean has a long tradition of adhering to the rule of law thus enhancing its attractiveness as a place to retire to.
"This gives a clear insight into the strategy for the deployment of capital in Jamaica.
Financial services-NCB/AIC/UGI; Health care-Blue Cross/Medical Associates; Telecommunications-Flow; Tourism-Trident/ Reggae Beach; Entertainment/media-CVM. So you see, there is method behind the madness."
Turnaround at NCB
Back in 2002, Lee Chin snapped up NCB after local business moguls showed no appetite to follow through on an acquisition.
That year saw it reporting a yearly profit of J$600 million.
For the six months ended 31 March 2006, NCB posted net profits of J$2.4 billion. This represents a 52 per cent increase (J$807 million) on the corresponding quarter of 2005.
"We saw that NCB had growth potential and so we set about stopping the slide there. Staff morale was low and the public had very little confidence in the bank so we had to address those problems. We invested heavily in technology to upgrade the bank's efficiency.
"Over the last four years we have built an institution that now has a strong reputation so that now young people do not have to emigrate looking for opportunities. They can remain at home and work for the fastest-growing commercial bank in Jamaica.
"I am particularly proud of the Institute for Leadership and Organisational Development (ILOD) initiative established by the management. There are now 210 staff members going through training and they should form the next cadre of managers," said the chairman of NCB.
AIC (Trinidad) and AIC (Barbados) continue to scour the Caribbean for investments and opportunities.
Health care
Lee Chin has made it clear that he would like to see a more robust health care service in the Caribbean.
"If we can develop robust first-world healthcare facilities we can encourage the baby boomers to come and settle in the Caribbean. Right now many of them are flying to India and Thailand for cosmetic surgery and hip replacements. Now why would they want to fly right across the world for medical services when they can get efficient service right here in the Caribbean?" said Lee Chin.
Earlier this year he told the Observer, "We have an interest generally in health care. As you know the health care in Jamaica is not robust. We have an interest in bringing 21st century facilities to Jamaica. So that may entail getting into the hospital business and Medical Associates may be one such way that we may do so.
According to press reports, 40 per cent of the hospital owned by a group of individual doctors has been sold, and it is not yet clear whether Lee Chin's organisation holds a majority stake.
NCB Group's insurance arm has already acquired a 75 per cent stake in Blue Cross Jamaica, confirming Lee Chin's commitment to grab a larger share of the local health insurance market.
Health care opportunities in other parts of the Caribbean are now being considered.
Telecommunications
Lee Chin has now made a foray into telecommunications investing some US$100 million into Barbados-based Flow, a digital cable television, Internet and digital land line provider. Here AIC holds a 50 per cent stake with the Risley Group of Barbados holding the remaining 50 per cent. Flow is the trading name of Merit Communications Limited. At the end of this month Flow will announce its roll-out schedule, which will see both metered and unlimited Internet service. Metered service begins at J$650 a month for 1 meg download speed and unlimited services begin at just under J$2000 for 2 meg download speed.
Now Columbus Communications, a consortium comprised of AIC, John Riseley of Barbados and Canadian tycoon Brendan Paddick operate two telecommunication companies in Jamaica.
Fibralink was granted a licence by the Government of Jamaica for a submarine fibre optic cable back in 2004 and became operational in March 2005. Fibralink handles its wholesale operations while Merit Communications Limited trading as Flow is the retail arm targeting corporate, business and residential customers.
A consortium lead by Motorola called New World Network owned and operated the Americas Region Caribbean Optical-Ring System (ARCOS), a leading submarine broadband cable network linking the United States, Mexico, Central America, South America and the Caribbean.
Last year Columbus Communications approached New World Network with a view to acquiring the company, which it did for US$450 million.
Columbus now offers bandwith to the Caribbean and other countries in the hemisphere with Fibralink connecting to ARCOS. Fibralink is now seeking to run a second fibre line out of Jamaica.
Columbus Communications has a controlling interest in Cable Bahamas, a cable television provider and owns 100 per cent of Cable Company of Trinidad & Tobago (CCTT) which in turn is now owned by Columbus Communications Trinidad & Tobago Limited.
Speaking to Caribbean Business Report on his telecommunications strategy, Lee Chin said, "For far too long the cost of telecommunications in the Caribbean has been too high with companies not being cost competitive.
This has made it prohibitive to many people as you can see with the low access to Internet use in homes. We aim to change that. The retirees will be counting upon a reliable cost effective telecommunications network to keep in touch with the mainland. This will spawn new industries. As far as the Caribbean is concerned companies complain about the high cost of telecommunications and labour. Well, we have brought down the cost of telecommunications and will continue to be cost competitive. A robust and reliable network will spur further economic development throughout the Caribbean."
Tourism and Entertainment
The Trident hotel in Port Antonio, Reggae Beach in Ocho Rios and CVM Communications Group all fit nicely into Lee Chin's tourism and entertainment portfolio. Tourism has become the leading driver of Caribbean economies and this has not escaped the dynamic head of AIC.
He plans to use Reggae Beach as a wellness centre and to encourage indigenous entertainment there.
He has for some time now wanted to acquire a stake in a media house and his advances to RJR were rebuffed. However, CVM led by Neville Blythe needed a white knight and Lee Chin was just that. He has promised to make that organisation more cost-efficient as it looks to profitability, and to export local content both to the wider Caribbean and the diaspora.
"If we are to optimise the most from tourism, then controlling the high level of crime is imperative. No one wants to visit a destination where their safety is at risk. You can't have a vibrant tourism industry where the insidiousness of crime pervades everywhere.
"As far as the Caribbean is concerned - and this does not apply to just Jamaica, cruise ships and all-inclusive hotels do not allow for economic dispersion. It shouldn't be the case that the majority of tourists get herded onto site and the tourism dollar does not trickle down into the communities and to local entrepreneurs. There is something wrong with that picture. We need a type of tourism that differentiates the region and sells indigenous services", said Lee Chin.
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Chairman of Canadian mutual fund company AIC, Michael Lee Chin, who is also the chairman of Jamaican banking house NCB Group, continues to extol the investment opportunities the Caribbean holds.
He has practically single-handedly returned confidence to the Jamaican business sector with a number of investments dating back to 2002 when AIC acquired a majority interest in NCB. He then followed up with interests in Dyoll, the Mutual Life Towers, Kingston Wharves, Reggae Beach, the Trident Hotel, United General Insurance, and CVM. To date, Lee Chin has invested Can$1 billion in Jamaica and is now looking to the wider Caribbean.
Committed to investing in the Caribbean
To underscore his commitment, he is spearheading the AIC Caribbean Fund. Last month the Overseas Private Investment Corporation (OPIC) loaned AIC US$80 million to assist in the building of this Caribbean private equity investment fund.
The AIC Caribbean Fund will make investments in businesses located in countries of the Caribbean Community (CARICOM), with an emphasis on Jamaica, Barbados and Trinidad & Tobago. The fund will focus on the tourism, telecommunications, healthcare, energy, and financial services sector, and has a target capitalisation of US$250 million.
Over the last year analysts, business writers and observers have seen no clear pattern to Lee Chin's acquisition strategy; some even fear that he may become over-leveraged.
Speaking with Caribbean Business Report from AIC's headquarters in Hamilton, Canada, Lee Chin sought to explain his Caribbean strategy: "There are some 80 million Americans coming up for retirement and five per cent of those (four million) will be looking to the Caribbean because of its warm weather and proximity to the United States.
Already, the coastlines of North Carolina and Florida are saturated. Therefore, I expect to see four million retirees superimposed on an English-speaking Caribbean population of eight million.
"So what are the services these retirees will be requiring? We have earmarked financial services, health care, telecommunications, real estate and entertainment."
Method to the madness
Expanding further on this thinking, he said that the Caribbean's proximity to the United States means that it has a vested interest in making the region safe, and also the Caribbean has a long tradition of adhering to the rule of law thus enhancing its attractiveness as a place to retire to.
"This gives a clear insight into the strategy for the deployment of capital in Jamaica.
Financial services-NCB/AIC/UGI; Health care-Blue Cross/Medical Associates; Telecommunications-Flow; Tourism-Trident/ Reggae Beach; Entertainment/media-CVM. So you see, there is method behind the madness."
Turnaround at NCB
Back in 2002, Lee Chin snapped up NCB after local business moguls showed no appetite to follow through on an acquisition.
That year saw it reporting a yearly profit of J$600 million.
For the six months ended 31 March 2006, NCB posted net profits of J$2.4 billion. This represents a 52 per cent increase (J$807 million) on the corresponding quarter of 2005.
"We saw that NCB had growth potential and so we set about stopping the slide there. Staff morale was low and the public had very little confidence in the bank so we had to address those problems. We invested heavily in technology to upgrade the bank's efficiency.
"Over the last four years we have built an institution that now has a strong reputation so that now young people do not have to emigrate looking for opportunities. They can remain at home and work for the fastest-growing commercial bank in Jamaica.
"I am particularly proud of the Institute for Leadership and Organisational Development (ILOD) initiative established by the management. There are now 210 staff members going through training and they should form the next cadre of managers," said the chairman of NCB.
AIC (Trinidad) and AIC (Barbados) continue to scour the Caribbean for investments and opportunities.
Health care
Lee Chin has made it clear that he would like to see a more robust health care service in the Caribbean.
"If we can develop robust first-world healthcare facilities we can encourage the baby boomers to come and settle in the Caribbean. Right now many of them are flying to India and Thailand for cosmetic surgery and hip replacements. Now why would they want to fly right across the world for medical services when they can get efficient service right here in the Caribbean?" said Lee Chin.
Earlier this year he told the Observer, "We have an interest generally in health care. As you know the health care in Jamaica is not robust. We have an interest in bringing 21st century facilities to Jamaica. So that may entail getting into the hospital business and Medical Associates may be one such way that we may do so.
According to press reports, 40 per cent of the hospital owned by a group of individual doctors has been sold, and it is not yet clear whether Lee Chin's organisation holds a majority stake.
NCB Group's insurance arm has already acquired a 75 per cent stake in Blue Cross Jamaica, confirming Lee Chin's commitment to grab a larger share of the local health insurance market.
Health care opportunities in other parts of the Caribbean are now being considered.
Telecommunications
Lee Chin has now made a foray into telecommunications investing some US$100 million into Barbados-based Flow, a digital cable television, Internet and digital land line provider. Here AIC holds a 50 per cent stake with the Risley Group of Barbados holding the remaining 50 per cent. Flow is the trading name of Merit Communications Limited. At the end of this month Flow will announce its roll-out schedule, which will see both metered and unlimited Internet service. Metered service begins at J$650 a month for 1 meg download speed and unlimited services begin at just under J$2000 for 2 meg download speed.
Now Columbus Communications, a consortium comprised of AIC, John Riseley of Barbados and Canadian tycoon Brendan Paddick operate two telecommunication companies in Jamaica.
Fibralink was granted a licence by the Government of Jamaica for a submarine fibre optic cable back in 2004 and became operational in March 2005. Fibralink handles its wholesale operations while Merit Communications Limited trading as Flow is the retail arm targeting corporate, business and residential customers.
A consortium lead by Motorola called New World Network owned and operated the Americas Region Caribbean Optical-Ring System (ARCOS), a leading submarine broadband cable network linking the United States, Mexico, Central America, South America and the Caribbean.
Last year Columbus Communications approached New World Network with a view to acquiring the company, which it did for US$450 million.
Columbus now offers bandwith to the Caribbean and other countries in the hemisphere with Fibralink connecting to ARCOS. Fibralink is now seeking to run a second fibre line out of Jamaica.
Columbus Communications has a controlling interest in Cable Bahamas, a cable television provider and owns 100 per cent of Cable Company of Trinidad & Tobago (CCTT) which in turn is now owned by Columbus Communications Trinidad & Tobago Limited.
Speaking to Caribbean Business Report on his telecommunications strategy, Lee Chin said, "For far too long the cost of telecommunications in the Caribbean has been too high with companies not being cost competitive.
This has made it prohibitive to many people as you can see with the low access to Internet use in homes. We aim to change that. The retirees will be counting upon a reliable cost effective telecommunications network to keep in touch with the mainland. This will spawn new industries. As far as the Caribbean is concerned companies complain about the high cost of telecommunications and labour. Well, we have brought down the cost of telecommunications and will continue to be cost competitive. A robust and reliable network will spur further economic development throughout the Caribbean."
Tourism and Entertainment
The Trident hotel in Port Antonio, Reggae Beach in Ocho Rios and CVM Communications Group all fit nicely into Lee Chin's tourism and entertainment portfolio. Tourism has become the leading driver of Caribbean economies and this has not escaped the dynamic head of AIC.
He plans to use Reggae Beach as a wellness centre and to encourage indigenous entertainment there.
He has for some time now wanted to acquire a stake in a media house and his advances to RJR were rebuffed. However, CVM led by Neville Blythe needed a white knight and Lee Chin was just that. He has promised to make that organisation more cost-efficient as it looks to profitability, and to export local content both to the wider Caribbean and the diaspora.
"If we are to optimise the most from tourism, then controlling the high level of crime is imperative. No one wants to visit a destination where their safety is at risk. You can't have a vibrant tourism industry where the insidiousness of crime pervades everywhere.
"As far as the Caribbean is concerned - and this does not apply to just Jamaica, cruise ships and all-inclusive hotels do not allow for economic dispersion. It shouldn't be the case that the majority of tourists get herded onto site and the tourism dollar does not trickle down into the communities and to local entrepreneurs. There is something wrong with that picture. We need a type of tourism that differentiates the region and sells indigenous services", said Lee Chin.
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