Equipment rental and fleet management company Ameco Jamaica is now a part of the Stewart’s Automotive Group, which has rebranded it as JAMECO.
The transaction was announced by the seller, American company Fluor, as a US$22 million deal in market filings. That translates to more than $3 billion in local currency.
Stewart’s Automotive Managing Director Duncan Stewart said the acquisition has been over one year in the making since Stewart’s approached Ameco with a takeover proposal.
“We approached them to ask if they were willing to sell and they agreed. Subsequent to that they said they wanted to sell the worldwide operation. I would say we were fortunate with our timing,” Stewart said.
Fluor Corp, the parent company for Ameco, said in an SEC filing that it sold “substantially all of the assets of Ameco Caribbean to Stewart’s Automotive Group in Jamaica for $22m”.
The company, which had previously announced its plans in September 2019 to fully divest Ameco construction rental company, said the sale of the Jamaican operation marks the initial step in the divestiture.
Stewart said that over the year of talks with Fluor included different levels of approval, due diligence and meeting of performance markers.
Ameco has been providing fleet and equipment management solutions in Jamaica since 2001 and presently operates from four locations: Spanish Town Road in Kingston; Montego Bay; Mandeville, Manchester; and Runaway Bay, St Ann.
Stewart says the takeover vaults Stewart’s Automotive to the No. 1 spot as the largest fleet operator in Jamaica. The more than 140 staff employed there – with only two exceptions – will be transitioning to JAMECO, he said.
JAMECO will continue to be led by Brian Pengelley who was the country manager for Ameco Jamaica.
The fleet management company provides services to companies such as Jamaica Public Service Company, Jamaica Broilers Group and Tastee Patties, among others. Stewart says all the existing contracts will transition to JAMECO.
“We basically bought the continuing business. The vast majority of the staff remains intact, so too the locations and the client arrangements,” he said.
Stewart’s Automotive Group operates a range of dealerships for cars and trucks. It represents brands such as Mercedes-Benz, Mitsubishi and Suzuki.
Member company Stewart’s Industrial, located at Bell Road in Kingston, did business with Ameco Jamaica even before the acquisition, Stewart said.
“The Bell Road operation is a dealership where we do sales, service and spare parts for industrial-related items such as trucks, construction and mining equipment, and so on,” he said, while noting that Stewart’s has been Ameco’s largest supplier. The acquisition brings the partnership fully into the Stewart’s tent.
JAMECO will fall under the umbrella of Stewart’s Automotive Group but operated as a separate entity.
“It will not be a direct subsidiary but rather a stand-alone company under the same owner. For us it is a signal of our confidence in the future of the Jamaican economy,” he said.
Source: The Jamaica Gleaner
by: Neville Graham