FINANCIAL CHRONICLE™
Dear Reader,

Registration with the Sri Lanka FINANCIAL CHRONICLE™️ would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
FINANCIAL CHRONICLE™️
www.srilankachronicle.com


Join the forum, it's quick and easy

FINANCIAL CHRONICLE™
Dear Reader,

Registration with the Sri Lanka FINANCIAL CHRONICLE™️ would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
FINANCIAL CHRONICLE™️
www.srilankachronicle.com
FINANCIAL CHRONICLE™
Would you like to react to this message? Create an account in a few clicks or log in to continue.

Encyclopedia of Latest news, reviews, discussions and analysis of stock market and investment opportunities in Sri Lanka


Submit PostSubmit Post
ශ්‍රී ලංකා මූල්‍ය වංශකථාව - සිංහල
Submit Post



Latest topics

» What will happen tomorrow?
by Chathur Today at 10:39 pm

» NEVER GIVE UP BECAUSE: Stock market for beginners
by Asoka Samarakone Today at 9:37 pm

» Make it your goal to stay positive in a negative market
by reyaz Today at 9:01 pm

» Daily Foreign Transactions
by Pradeep90 Today at 8:32 pm

» CHEVRON LUBRICANTS LANKA PLC ((LLUB.N0000)
by Antonym Today at 8:23 pm

» GLAS will be winner with Super Gain.
by C.THARANGA Today at 8:12 pm

» Most Undervalued Shares
by celtic tiger Today at 1:38 pm

» Ban of chemical fertilizers is a great news
by samaritan Today at 9:59 am

» SANASA DEVELOPMENT BANK PLC (SDB.N0000)
by samaritan Today at 9:48 am

» Price prediction on GRAN and TAFL
by Antonym Today at 8:47 am

» CENTRAL INDUSTRIES PLC (CIND.N0000)
by Bakkabwoi Today at 12:25 am

» DIPD/HAYC/HAYL
by desilva Yesterday at 10:48 pm

» Prime Residencies IPO. Over Priced?
by ChooBoy Yesterday at 5:08 pm

» FUTURE of BROWNS INVESTMENT PLC (BIL)
by samaritan Yesterday at 1:10 pm

» RSI & Stop Loss Combined Strategy to generate more than 70% profit in CSE
by samaritan Yesterday at 11:51 am

» "MFL" DEAL to 12 RS (multi finance plc)
by arunaupendra Yesterday at 9:47 am

» Millennial Capital Youtube Channel
by MillennialC Mon May 10, 2021 11:09 pm

» JANASHAKTHI INSURANCE COMPANY PLC
by Accountant Mon May 10, 2021 6:33 pm

» Synergies of possible merger between Sampath Bank and PABC
by MoneyLover Mon May 10, 2021 4:04 pm

» GREAT NEWS! Sri Lanka inks US$500mn deal with Korea Eximbank financing
by ADVENTUS Mon May 10, 2021 2:16 pm

EXPERT CHRONICLE™

ECONOMIC CHRONICLE

GROSS DOMESTIC PRODUCT (GDP)


CHRONICLE™ YouTube

CHRONICLE™ NEWS PRODUCTS

FINANCIAL CHRONICLE™

Views & Reviews, Analysis, Evaluations, Discussions, Gossip and Hot Tips relating to Sri Lankan companies listed on the Colombo Stock Exchange (CSE)
Contribute




DAILY CHRONICLE™

Latest news and articles published in Newspapers, Websites, Blogs and other online news sites relating to business and investments in Sri Lanka
Contribute



ECONOMIC CHRONICLE™

This is a section that provide news, views, analysis, predications relating to Political and Socio-Economic factors and how such activities affect the Stock Market and other economic activity of the Country.

Contribute




EXPERT CHRONICLE™

This is an exclusive section for Expert Articles which will help member to share knowledge through comments and responses of the members. All members are allowed to reply and make comments to these articles.

Contribute


Submit Post


CHRONICLE™ YouTube

Youtube Videos and other visual presentations relating Stock market and other investment advise submitted by members or other contributors.

Contribute


Submit Post


කොළඔ කොටස් වෙළඳපොළේ වංශකථාව
කොළඔ කොටස් වෙළඳපොළේ ලැයිස්තුගත සමාගම් කොටස් ගැන තොරතුරු¸විශ්ලේෂණ¸සාකච්ඡා¸ කටකතා¸රසකතා යන සියල්ල අපේම සිංහලෙන් කතා කළ හැකි ‘කතා මණ්ඩපය’

Contribute

Twitter Feeds
POPULAR COMPANIES
A

ABANS ELECTRICALS PLC

ACCESS ENGINEERING PLC Hot

ACL CABLES PLC

ACL PLASTICS PLC

ACME PRINTING & PACKAGING PLC

AGSTAR PLC

AITKEN SPENCE HOTEL HOLDINGS PLC

AITKEN SPENCE PLC

ANILANA HOTELS AND PROPERTIES PLC

ARPICO INSURANCE PLC

ASIA ASSET FINANCE PLC

ASIA CAPITAL PLC

B

BAIRAHA FARMS PLC

BALANGODA PLANTATIONS PLC

BIMPUTH FINANCE PLC

BLUE DIAMONDS JEWELLERY WORLDWIDE PLC

B P P L HOLDINGS PLC

BROWNS BEACH HOTELS PLC

BROWNS INVESTMENTS PLC

C

CARGO BOAT DEVELOPMENT COMPANY PLC

CENTRAL INDUSTRIES PLC

CEYLON COLD STORES PLC

CEYLON GRAIN ELEVATORS PLC Hot

CEYLON TEA BROKERS PLC

CEYLON TOBACCO COMPANY PLC

CHEVRON LUBRICANTS LANKA PLC

COLOMBO FORT LAND & BUILDING PLC

COMMERCIAL BANK OF CEYLON PLC

CITRUS LEISURE PLC Hot

COMMERCIAL CREDIT AND FINANCE PLC

D

DANKOTUWA PORCELAIN PLC

DFCC BANK PLC

DIALOG AXIATA PLC

DIALOG FINANCE PLC

DIPPED PRODUCTS PLC

DISTILLERIES COMPANY OF SRI LANKA PLC

DUNAMIS CAPITAL PLC

E

EAST WEST PROPERTIES PLC Hot

EASTERN MERCHANTS PLC

EXPOLANKA HOLDINGS PLC

E-CHANNELLING PLC

F

FIRST CAPITAL HOLDINGS PLC

G

GALADARI HOTELS (LANKA) PLC

GUARDIAN CAPITAL PARTNERS PLC

H

HATTON NATIONAL BANK PLC

HAYLEYS PLC

HAYLEYS FABRIC PLC

HAYLEYS FIBRE PLC Hot

HEMAS HOLDINGS PLC

HIKKADUWA BEACH RESORT PLC

HNB ASSURANCE PLC

HVA FOODS PLC

J

JANASHAKTHI INSURANCE COMPANY PLC

JOHN KEELLS HOLDINGS PLC Hot

JOHN KEELLS HOTELS PLC

L

LANKA ASHOK LEYLAND PLC

LANKA IOC PLC

LANKEM CEYLON PLC

LANKEM DEVELOPMENTS PLC

LAUGFS GAS PLC

LAUGFS POWER LIMITED

LOLC FINANCE PLC

LOLC HOLDINGS PLC

LUCKY LANKA MILK PROCESSING COMPANY PLC

M

MELSTACORP PLC

N

NATIONAL DEVELOPMENT BANK PLC

NATION LANKA FINANCE PLC

NESTLE LANKA PLC

O

ORIENT FINANCE PLC

OVERSEAS REALTY (CEYLON) PLC

P

PANASIAN POWER PLC

PEOPLE'S LEASING & FINANCE PLC

PIRAMAL GLASS CEYLON PLC

PRIME FINANCE PLC

R

RAIGAM WAYAMBA SALTERNS PLC

RENUKA AGRI FOODS PLC

RENUKA CAPITAL PLC

RENUKA HOLDINGS PLC

RICHARD PIERIS AND COMPANY PLC

RICHARD PIERIS EXPORTS PLC Hot

ROYAL CERAMICS PLC

S

SAMPATH BANK PLC

SEYLAN BANK PLC

SIERRA CABLES PLC

SINGHE HOSPITALS PLC Hot

SMB LEASING PLC

SOFTLOGIC HOLDINGS PLC

SOFTLOGIC LIFE INSURANCE PLC

SRI LANKA TELECOM PLC

SWISSTEK (CEYLON) PLC Hot

T

TEEJAY LANKA PLC

TESS AGRO PLC

THREE ACRE FARMS PLC

TOKYO CEMENT COMPANY (LANKA) PLC Hot

U

UNION BANK OF COLOMBO PLC

V

VALLIBEL FINANCE PLC

VALLIBEL ONE PLC Hot

VALLIBEL POWER ERATHNA PLC

W

WASKADUWA BEACH RESORT PLC


You are not connected. Please login or register

FINANCIAL CHRONICLE™ » FINANCIAL CHRONICLE™ » Dhammika, RCL in Rs. 20 b takeover bid of Hayleys

Dhammika, RCL in Rs. 20 b takeover bid of Hayleys

Go down  Message [Page 1 of 1]

CSE1

CSE1
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
Acting in concert, trigger SEC’s Takeovers and Mergers Code by crossing 30% stake in manufactured export rich diversified blue chip and one of few oldest Lankan multinationals

It was untouched as well as impregnable for years, but finally two men – who are often underestimated – made it against the odds.

The duo, Dhammika and Nimal Perera – unrelated but best of buddies – yesterday triggered the SEC Takeovers and Mergers Code on manufactured export rich diversified blue chip Hayleys PLC, which is one of Sri Lanka’s few multinationals, founded in 1878.

Royal Ceramics’ (RCL) purchase of 155,000 Hayleys shares yesterday at Rs. 380 each from Jetwing Group-owned Negombo Hotels triggered the code. On Wednesday RCL bought 225,000 shares at the same price preceded by Dhammika buying around 200,000 shares on Tuesday both from S.N. Palihena, former General Manager of Bank of Ceylon.

These deals collectively pushed the combined stake of Dhammika and RCL above the SEC threshold of 30%. Dhammika’s personal stake in Hayleys is estimated to be around 28% whilst that of RCL is over 2%. Dhammika, via his currently 100% owned Vallibel One Ltd., holds a 51% stake in RCL.

The issued shares of Hayleys is 75 million and the remaining 70% stake amounts to 52.5 million shares and at the offer price of Rs. 380 per share, the takeover bid is worth Rs. 20 billion, making it the biggest ever in the corporate history of Sri Lanka. The cost of acquiring the 21% stake amounting to 15.75 million shares to get 51% control is Rs. 6 billion. Market closed before the news of the takeover bid and Hayleys saw 225,972 shares traded between a high of Rs. 399 and a low of Rs. 380 before closing at Rs. 390, down by Rs. 4.
“We triggered the code because we believe in achieving 51% control which has been our policy from the inception in all our previous endeavours,” RCL Managing Director Nimal, who was instrumental in encouraging Dhammika to enter Hayleys, told Daily FT. Dhammika is the Deputy Chairman of RCL and both serve on the Board of Hayleys with former functioning as the Deputy Chairman.

Triggering the SEC Code isn’t new to the Dhammika-Nimal duo. In fact they are masters in it. In the early and mid 2000s, the duo created a sensation by triggering the code on six companies starting from Connaissance (now Amaya Hotels and Resorts), Hotel Reefcomber, Fortress, Royal Ceramics, LB Finance and Vallibel Finance (then Rupee Finance).

These acquisitions are what made the rest of corporate Sri Lanka take notice of the duo, whose relationship has strengthened with the passage of time.

In mid June 2008, when Dhammika bought a symbolic yet strategic 7% stake in Hayleys held by Carson Cumberbatch Group at Rs. 125 per share, those who knew the duo well sensed the game plan. Thereafter he went up to 15%, after which Hayleys had to partly bite its own pride and invite Dhammika on to the Board followed by Nimal. Thereafter they kept on collecting available quantities of Hayleys, moving up to 23% in early 2010 and by October 2010, the collective stake was around 29%.

With a 30%+ stake along with around a 9% stake held by Hayleys subsidiaries, Dhammika has effective control, but it appears that they will be comfortable only with 51%.

The internal arrangement ESOP owns around a 9% stake in Hayleys as well. Hayleys’ former iconic Chairman D.S. Jayasundera’s Trust holds 11.6%.

Hayleys has been susceptible to takeover bids or ideas. A way to counter these threats was to float the ESOP. There were reports or rumours in the past of Carson Group being keen, but that it backed out due to resistance from within. Thereafter, fresh rumours surfaced during the active days of Lankan-born US Hedge Fund Manager Raj Rajaratnam, who held a substantial stake.

A senior business leader recalled that a former Hayleys Board Director, the late M.T.L. Fernando of Ernst & Young Sri Lanka fame, maintained that Hayleys was impregnable to outsiders. In that respect, the Dhammika and Nimal duo have made history.

Founded in 1878 as Chas P. Hayley & Company, Hayleys is described as one of the largest Sri Lankan multinationals. Its portfolio of globally competitive core businesses includes global markets and manufacturing, agriculture and agri business, transportation and infrastructure and consumer products and leisure. Hayleys also accounts for 2.45% of Sri Lanka’s export income.

Personally, for Dhammika, the Hayleys takeover bid comes amidst a much smaller exercise on Lanka Aluminium PLC. He triggered the SEC Code early this week when he increased the stake to 34% with the purchase of 8% at Rs. 41.50 per share. If minority shareholders accept the offer, the total cost for Dhammika will be Rs. 375 million.

The takeover bid of the number two in the industry, Lanka Aluminium, is following Hayleys acquiring a 95% stake in market leader Alumex for Rs. 2 billion late last year.

The Dhammika-Nimal duo remain dynamic. Recently they successfully raised Rs. 4.9 billion in what was the biggest private placement in Sri Lanka for Dhammika’s first holding company Vallibel One Ltd. The issuance of 196 million shares at Rs. 25 each drew Rs. 7.6 billion demand.

This private placement was a precursor to Vallibel One’s IPO at the same price in March. Vallibel One holds control of RCL, LB Finance and a 15% stake in Sampath Bank. In addition it has a leisure arm, Green Water Ltd., which is building a 382 room five star luxury resort in Negombo as well as planned investments in renewable energy projects.

Whilst third quarter results are pending, Hayleys in the first half posted a pre‐tax profit of Rs. 1.2 billion on a turnover of Rs. 24.8 billion.

Turnover grew by a solid 47% over the corresponding six months of last year, with significantly higher volumes in key sectors such as hand protection, purification and transportation and the consolidation of contributions from increased shareholdings in sectors such as textiles, leisure and plantations.

First half profit before tax reflected an improvement of 11%, despite the latter including a capital gain of Rs. 226 million. Tax expenses increased in the six months ending 30 September 2010, largely due to this reason. Consequently, profit after tax for the period at Rs. 830 million was marginally above that of last year.

source - www.ft.lk

Back to top  Message [Page 1 of 1]

Permissions in this forum:
You cannot reply to topics in this forum