by Richard Coulson
The distinguished long-time head of our Securities Commission, Hillary Deveaux, was clearly struggling for the right words in his new role as Chairman of Investar Securities, manager of the current offering of the two Titan Funds, promoted by protean entrepreneur Sebas Bastian.
While calling the demand “fairly substantial” Mr. Deveaux disclosed that only about 400 subscribers bought over $750,000 of shares, most of which were in the Balaced Fund since sales of the Fixed Income Fund had “not been impressive”. The month-long offering would be extended for 16 days to allow for intensive marketing In The Family Islands, where he claimed strong demand was found.
We do not underestimate the difficulty in launching a new fund in our small capital markets, and we welcome any effort to extend securities ownership among less affluent Bahamians, but the hard truth is that Titan Funds face tough competition. The Fixed Income Fund hardly differs from the Prime Income Fund managed by another firm, with $144 million of shares already outstanding after being marketed since 2012, They both invest mainly in Government bonds, and you cannot slice this apple in different ways.
The Balanced Fund has more interesting objectives in equity investments, but must face the other firm’s competing Targeted Equity Fund, $21 million in present size. The Balanced Fund has one unique feature: it is authorized to invest in Island Luck, the country’s dominant gaming house controlled by Sebas Bastian, which is believed to be very profitable. But Island Luck has not issued any financial statements to verify this status, so investors must rely on speculation and hearsay.
Mr. Bastian is a cool customer who is probably not losing any sleep over Titan Funds’ lingering take-off. He has plenty of other successful ventures in his portfolio and can afford to await the gradual growth of his new experiment in the securities business. Eventually, he may decide to “go public” with Island Luck, via an IPO revealing full information.
First published in The Tribune, Thursday, July 11, 2019, and is posted here with the kind permission of the author.
Mr. Coulson has had a long career in law, investment banking and private banking in New York, London, and Nassau, and now serves as director of several financial concerns and as a corporate financial consultant. He has recently released his autobiography, A Corkscrew Life: Adventures of a Travelling Financier.
