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Dilith Jayaweera: Guts and Grit Part-01
Insider Trading?
The only accusation that was levelled against us was when we declared a Rights issue and attached Warrants - one issue and three warrants attached in one day. The accusation was, how could we have decided on such a complicated format in a period of one to two hours. They thought it was too complex for a newcomer to take such a decision. Right through they wanted to know if we had prior knowledge before the date of the board meeting. What they did not probably understand is that we approached all our decisions during the course of our career in this manner. To us, while the nitty gritty financials and the works matter, what really creates the adrenaline rush is a gut feel. We enjoy the freedom we have as a young team to try different things. Some work, some may not but we enjoyed the experience. We know it’s a little maverick but the greatest achievers of all time seem to have thought in a similar manner.
When we first invested the money that we had saved at the time in a printing machine, it was a decision made on gut feel. There was an individual whom we met when we advertised for an Account Executive position who was 45 years old. At our interview, I pointed out that the position was for young people. Then when I went through his CV I found that he was a printer. I told him he should be our Printing Executive. We did not have such a position but we created it at that moment. He said that he could manage a printing press. Within a week, we purchased a used printing machine from Premadasa Printers. There was no lengthy business plan.
Setting up our pre-press business was also similar. We ventured into a business of our own to do colour separations, as the suppliers our press was working with were not meeting tough deadlines and we as the printer were getting the flack from clients. It was then that we decided to set up our own colour separation machine in-house and bought a brand new Katana machine offering a digital pre-press solution.
We have a theory that we use in all of our investments; that is the worst case scenario analysis. We analyse what would happen in the worst case scenario. What if the printing operation fails? Nothing will happen as our core business will continue to run. We may be able to recover part of the money invested. We start again as far as our investments are concerned. Examples are as I mentioned before, Article 14 - the Freedom of Expression, which was an experimental project. We converted part of our outdoor advertising arm to convert left over rods into small furniture. It yielded profits but considering the management time that we put into the business it wasn’t sufficient. We started a small cafe, with a freedom theme. We ran it for about a year. Then we realised that the involvement was too much and shut it down.
Similarly the stock market was no different. It was an opportunity to innovate value for our company with whatever tools that were available to us. We started with trading, buying and selling, and making capital gains. Then we went into acquisition. That is Reefcomber, which we rebranded as Citrus, then as we did not have money for expansion we went in for the rights issue and three warrants. With that money we converted the 40 room hotel into a 94 room refurbished hotel in less than six months. We used new technology, our thinking and that itself is an example. They could not see Citrus being expanded as it was only on two acres. Again as value innovators we saw a different option. We put a tower at the road frontage and built up five floors overlooking the old building and converted the first two floors for services and large banquet facilities. We believe in change through innovation.
From rights, warrants to acquisitions, we then moved on to private placement. We bought a land in Waskaduwa. Through a private placement we collected the money and fully funded the whole purchase of the land. Thereafter we went in for an IPO. We did the same with Kalpitiya where we bought a beautiful 74 acre land from the money we acquired through private placement. The investors had faith in us, they put in money. Now we are going ahead with these projects. It is the same with Passekudah. Through the tools available in the stock market, and value formation we have formed new capital, which we did not have. We keep shares in the Bank and acquire facilities. The banks are willing to support, as we have something to offer as collateral. We keep this as collateral and expand.
The money that we raised from private placements and rights/warrants of Citrus, we invested in Colombo Land and acquired a 20 percent stake. We negotiated with the Singaporean shareholder, and convinced them to become part of its development. Liberty Plaza will have much more additional space being built and the whole place will be refurbished. Another tower just adjoining the original structure will also be constructed, which we have purchased from a private party. This is the kind of value innovation we like to be involved in, not petty mud slinging campaigns.
People begin to wonder how we have got the money. At times we are accused of obtaining funds from politicians and politically connected people. They don’t understand our little formula through which we have raised close to four billion rupees within a period of one year and eight months. It is very simple.
That is in fact why, we went to courts when we were accused of making money through drug peddling. There is a case being heard in the Colombo District Courts. We filed action against BBC as well. That case is also being heard. According to the law of defamation in this country, the challenge is for whomever that made the defamatory statement to prove that the facts are correct. You have to subject yourself to it, and in the dock they can ask you any question about every cent that you have earned. It is only because our hands are clean that we have confidently filed action. We are strong believers of the judiciary and we have no qualms about fighting for what we believe is right. To us corporate ethics and integrity are very important. If you talk about corporate cleanliness we are 100 percent clean. We have never used anything other than our creativity, our thinking, our commitment, our spirit or our teamwork for any gain.
We don’t believe in unjust enrichment. We don’t believe in short cuts to become rich or powerful. Every cent added to this company or value added to this company is through our creativity and hard work. Of course we are a group of people who are not scared. We only look at the worst case scenario. I travel by bus when I want to, I visit any bar. I am not someone who has got accustomed to a luxurious lifestyle. It is the same with our colleagues. The worst case scenario is that you get into a three wheeler, you go to a road side food outlet and you are still the happy man you have always been. Then you have that much leverage to play with your additional money that you have saved. Your investment decisions could be based on that since you have nothing major to lose. If you look at the way that we have taken risks in the stock market, that is the spirit in which we have taken decisions.
Someone who doesn’t want to know us could view us as people who have laundered money, or have acquired some sponsored funds or used other ways of making money. I am confident that we can prove our work ethics in court. It is obvious that they will question us on each and everything that we have done in the last 50 years, including our private lives, so we are open to it. We can explain anything, anywhere.
Touching on market manipulation or insider trading; in my honest opinion the market really opened in post war Sri Lanka. Many newcomers came into the market. Though I bought my first shares in late 1980s when the Sampath share issue came, I was a small trader. I did it for two to three years and gave up completely. We returned to it like many others after the war. Manipulation is a criminal offense. Criminal offenses are generally looked at from a legal point of view as mens rea, or the mental involvement or intention at the time of committing the act. If I buy shares and manipulate knowingly to benefit from it, it constitutes a criminal offense. As a company, we didn’t do any manipulation ever.
If you ask me if it happened in the market, honestly from a bird’s eye perspective, I would say yes. If you study stock markets around the world to see to what extent there is manipulation, it is a subjective issue. How do you decide at which point a person had criminal intent? If you look at some transactions, it is fair to come to the conclusion that there has been some manipulation techniques involved. As a criminal offense it has its own punishments attached to it. There is a procedure. You can’t name someone as a criminal until proven guilty. We forget such principles when we start naming people as manipulators.
The stock market basically functions on perceptions. Reality has very little value to that. When you say a market is being manipulated, what happens to that perception? Firstly you drive away members, and stakeholders from the business. This is our fight, personally. It has nothing to do with insider trading or malpractices. We are simply trying to say that if there are manipulators, get hold of them. Take them through the process; punish them. That is how a civil society works. You do not go public since it can create a negative perception. It goes against the system. If not by the time manipulators are basically declared innocent the market would have fallen into a grave.
There are manipulations happening elsewhere, in the US, the most developed market in the world. We are all against it. Suddenly, when the regulator himself makes a statement to the newspapers about manipulators, we consider that to be a bigger crime than what actual manipulators have done. Investors never expect a regulator to do that without going through the process. Such loose statements make a huge impact against the market. During the 30 year war, shares were traded at one rupee and ten cents. How does a market operate? It is the most open place. There is always a willing buyer, and a willing seller. It happens out in the open. No one can force another. It is all about disclosures. We are supposed to disclose each and every act. When we buy shares we have to control our stake of the company. It’s not a market like any other.
In fact the SEC, Securities Exchange Commission is a quasi judicial body. What the head of that body says makes a big difference in somebody’s life and in society. They base their decision, on the information that they get and that can have a major impact. That was our struggle and we are very happy and proud that nothing was done behind anybody’s back. A presentation on the state of the stock market was made to the President himself, in front of the then Securities Exchange Chairperson, the Colombo Stock Exchange Chairman, and the rest of the stake holders. The intention was to prove to the stakeholders that this was something that they have to look at seriously. There wasn’t any other intention. I personally got trashed in the newspapers for going ahead with the presentation, whereas the press pronounced that other stakeholders like the SEC were not afforded the same opportunity. That was all wrong. It was a complete misrepresentation of facts by the media. Not that I have much faith in the mischief making press community who take pleasure in gloom and negativity in a person or as a nation.
The press conference organised by us was purely and simply to convey the truth and correct the misconception created by “a media mafia”. I knew that from a PR point of view it could be a huge blunder but my conscience didn’t allow me to take it lying down, simply because of the unfairness of the situation.
Managing the media is no novelty for us who have been in this industry for so long. We are part of the media and we have had long standing positive relationships with many of them. In fact, through our communication services we promote these media houses for their sustenance and success. Managing perception is what we do for our brands. We are proud to have created the country’s most far reaching perception managing campaign in the likes of “Api Venuwen Api”. So its wrong to say I was caught unawares at the press conference. I was prepared. But above all, I wanted an opportunity to tell the truth. The real truth, which some media distorted.
This was more a CSR issue, we felt it was our duty. There are so many dependent people involved in the stock market transactions. It was our duty. We delivered. We have always done so in the spirit of Triad. And we are happy about it.
Source:-Business Today
Insider Trading?
The only accusation that was levelled against us was when we declared a Rights issue and attached Warrants - one issue and three warrants attached in one day. The accusation was, how could we have decided on such a complicated format in a period of one to two hours. They thought it was too complex for a newcomer to take such a decision. Right through they wanted to know if we had prior knowledge before the date of the board meeting. What they did not probably understand is that we approached all our decisions during the course of our career in this manner. To us, while the nitty gritty financials and the works matter, what really creates the adrenaline rush is a gut feel. We enjoy the freedom we have as a young team to try different things. Some work, some may not but we enjoyed the experience. We know it’s a little maverick but the greatest achievers of all time seem to have thought in a similar manner.
When we first invested the money that we had saved at the time in a printing machine, it was a decision made on gut feel. There was an individual whom we met when we advertised for an Account Executive position who was 45 years old. At our interview, I pointed out that the position was for young people. Then when I went through his CV I found that he was a printer. I told him he should be our Printing Executive. We did not have such a position but we created it at that moment. He said that he could manage a printing press. Within a week, we purchased a used printing machine from Premadasa Printers. There was no lengthy business plan.
Setting up our pre-press business was also similar. We ventured into a business of our own to do colour separations, as the suppliers our press was working with were not meeting tough deadlines and we as the printer were getting the flack from clients. It was then that we decided to set up our own colour separation machine in-house and bought a brand new Katana machine offering a digital pre-press solution.
We have a theory that we use in all of our investments; that is the worst case scenario analysis. We analyse what would happen in the worst case scenario. What if the printing operation fails? Nothing will happen as our core business will continue to run. We may be able to recover part of the money invested. We start again as far as our investments are concerned. Examples are as I mentioned before, Article 14 - the Freedom of Expression, which was an experimental project. We converted part of our outdoor advertising arm to convert left over rods into small furniture. It yielded profits but considering the management time that we put into the business it wasn’t sufficient. We started a small cafe, with a freedom theme. We ran it for about a year. Then we realised that the involvement was too much and shut it down.
Similarly the stock market was no different. It was an opportunity to innovate value for our company with whatever tools that were available to us. We started with trading, buying and selling, and making capital gains. Then we went into acquisition. That is Reefcomber, which we rebranded as Citrus, then as we did not have money for expansion we went in for the rights issue and three warrants. With that money we converted the 40 room hotel into a 94 room refurbished hotel in less than six months. We used new technology, our thinking and that itself is an example. They could not see Citrus being expanded as it was only on two acres. Again as value innovators we saw a different option. We put a tower at the road frontage and built up five floors overlooking the old building and converted the first two floors for services and large banquet facilities. We believe in change through innovation.
From rights, warrants to acquisitions, we then moved on to private placement. We bought a land in Waskaduwa. Through a private placement we collected the money and fully funded the whole purchase of the land. Thereafter we went in for an IPO. We did the same with Kalpitiya where we bought a beautiful 74 acre land from the money we acquired through private placement. The investors had faith in us, they put in money. Now we are going ahead with these projects. It is the same with Passekudah. Through the tools available in the stock market, and value formation we have formed new capital, which we did not have. We keep shares in the Bank and acquire facilities. The banks are willing to support, as we have something to offer as collateral. We keep this as collateral and expand.
The money that we raised from private placements and rights/warrants of Citrus, we invested in Colombo Land and acquired a 20 percent stake. We negotiated with the Singaporean shareholder, and convinced them to become part of its development. Liberty Plaza will have much more additional space being built and the whole place will be refurbished. Another tower just adjoining the original structure will also be constructed, which we have purchased from a private party. This is the kind of value innovation we like to be involved in, not petty mud slinging campaigns.
People begin to wonder how we have got the money. At times we are accused of obtaining funds from politicians and politically connected people. They don’t understand our little formula through which we have raised close to four billion rupees within a period of one year and eight months. It is very simple.
That is in fact why, we went to courts when we were accused of making money through drug peddling. There is a case being heard in the Colombo District Courts. We filed action against BBC as well. That case is also being heard. According to the law of defamation in this country, the challenge is for whomever that made the defamatory statement to prove that the facts are correct. You have to subject yourself to it, and in the dock they can ask you any question about every cent that you have earned. It is only because our hands are clean that we have confidently filed action. We are strong believers of the judiciary and we have no qualms about fighting for what we believe is right. To us corporate ethics and integrity are very important. If you talk about corporate cleanliness we are 100 percent clean. We have never used anything other than our creativity, our thinking, our commitment, our spirit or our teamwork for any gain.
We don’t believe in unjust enrichment. We don’t believe in short cuts to become rich or powerful. Every cent added to this company or value added to this company is through our creativity and hard work. Of course we are a group of people who are not scared. We only look at the worst case scenario. I travel by bus when I want to, I visit any bar. I am not someone who has got accustomed to a luxurious lifestyle. It is the same with our colleagues. The worst case scenario is that you get into a three wheeler, you go to a road side food outlet and you are still the happy man you have always been. Then you have that much leverage to play with your additional money that you have saved. Your investment decisions could be based on that since you have nothing major to lose. If you look at the way that we have taken risks in the stock market, that is the spirit in which we have taken decisions.
Someone who doesn’t want to know us could view us as people who have laundered money, or have acquired some sponsored funds or used other ways of making money. I am confident that we can prove our work ethics in court. It is obvious that they will question us on each and everything that we have done in the last 50 years, including our private lives, so we are open to it. We can explain anything, anywhere.
Touching on market manipulation or insider trading; in my honest opinion the market really opened in post war Sri Lanka. Many newcomers came into the market. Though I bought my first shares in late 1980s when the Sampath share issue came, I was a small trader. I did it for two to three years and gave up completely. We returned to it like many others after the war. Manipulation is a criminal offense. Criminal offenses are generally looked at from a legal point of view as mens rea, or the mental involvement or intention at the time of committing the act. If I buy shares and manipulate knowingly to benefit from it, it constitutes a criminal offense. As a company, we didn’t do any manipulation ever.
If you ask me if it happened in the market, honestly from a bird’s eye perspective, I would say yes. If you study stock markets around the world to see to what extent there is manipulation, it is a subjective issue. How do you decide at which point a person had criminal intent? If you look at some transactions, it is fair to come to the conclusion that there has been some manipulation techniques involved. As a criminal offense it has its own punishments attached to it. There is a procedure. You can’t name someone as a criminal until proven guilty. We forget such principles when we start naming people as manipulators.
The stock market basically functions on perceptions. Reality has very little value to that. When you say a market is being manipulated, what happens to that perception? Firstly you drive away members, and stakeholders from the business. This is our fight, personally. It has nothing to do with insider trading or malpractices. We are simply trying to say that if there are manipulators, get hold of them. Take them through the process; punish them. That is how a civil society works. You do not go public since it can create a negative perception. It goes against the system. If not by the time manipulators are basically declared innocent the market would have fallen into a grave.
There are manipulations happening elsewhere, in the US, the most developed market in the world. We are all against it. Suddenly, when the regulator himself makes a statement to the newspapers about manipulators, we consider that to be a bigger crime than what actual manipulators have done. Investors never expect a regulator to do that without going through the process. Such loose statements make a huge impact against the market. During the 30 year war, shares were traded at one rupee and ten cents. How does a market operate? It is the most open place. There is always a willing buyer, and a willing seller. It happens out in the open. No one can force another. It is all about disclosures. We are supposed to disclose each and every act. When we buy shares we have to control our stake of the company. It’s not a market like any other.
In fact the SEC, Securities Exchange Commission is a quasi judicial body. What the head of that body says makes a big difference in somebody’s life and in society. They base their decision, on the information that they get and that can have a major impact. That was our struggle and we are very happy and proud that nothing was done behind anybody’s back. A presentation on the state of the stock market was made to the President himself, in front of the then Securities Exchange Chairperson, the Colombo Stock Exchange Chairman, and the rest of the stake holders. The intention was to prove to the stakeholders that this was something that they have to look at seriously. There wasn’t any other intention. I personally got trashed in the newspapers for going ahead with the presentation, whereas the press pronounced that other stakeholders like the SEC were not afforded the same opportunity. That was all wrong. It was a complete misrepresentation of facts by the media. Not that I have much faith in the mischief making press community who take pleasure in gloom and negativity in a person or as a nation.
The press conference organised by us was purely and simply to convey the truth and correct the misconception created by “a media mafia”. I knew that from a PR point of view it could be a huge blunder but my conscience didn’t allow me to take it lying down, simply because of the unfairness of the situation.
Managing the media is no novelty for us who have been in this industry for so long. We are part of the media and we have had long standing positive relationships with many of them. In fact, through our communication services we promote these media houses for their sustenance and success. Managing perception is what we do for our brands. We are proud to have created the country’s most far reaching perception managing campaign in the likes of “Api Venuwen Api”. So its wrong to say I was caught unawares at the press conference. I was prepared. But above all, I wanted an opportunity to tell the truth. The real truth, which some media distorted.
This was more a CSR issue, we felt it was our duty. There are so many dependent people involved in the stock market transactions. It was our duty. We delivered. We have always done so in the spirit of Triad. And we are happy about it.
Source:-Business Today
