Ceylon Finance Today: Hatton National Bank PLC announced that it made a strategic decision to finance Softlogic Group's Rs 2.7 billion investment in Odel PLC.
"Softlogic purchased the shareholdings of Odel founder Otara Gunewardene, and brothers Ajith and Ruchi Gunewardene, in a groundbreaking transaction, which gives the Group 45% ownership in Odel, paving the way for it to assume control of the fashion retailer," the bank said in a statement.
"In his vision, Softlogic Group Chairman Ashok Pathirage has focused on the conglomerate becoming one of the leading retailers in the country while being the single largest franchisee of some of the most reputed international brands in the apparel and fashion accessories market in Sri Lanka. The acquisition of Odel gives Softlogic significant lead to retail its multinational brand portfolio through Odel, an immensely popular fashion chain.
Following this transaction, Softlogic is required to make a mandatory offer to repurchase shares from other shareholders of Odel under SEC rules," the bank said.
HNB CEO Jonathan Alles outlined the reasons which led HNB to finance a sizeable and high-profile transaction of this nature.
"It was an ideal opportunity to demonstrate the bank's commitment to the Softlogic Group, a valued relationship to the bank. This acquisition is a milestone achievement and we take considerable pride in ensuring that local entrepreneurs who are farsighted and visionary are supported fully. Therefore, the value and benefit delivered to all parties through the successful execution of this transaction is, rewarding for the bank," he said.
Softlogic Holdings PLC and Softlogic Retail (Private) Limited (a subsidiary of Softlogic Holdings PLC) on Thursday acquired a 45.16% stake of Odel PLC for over Rs 2.7 billion, with the fashion retailer's Founder Otara Gunewardene, a name synonymous with Odel, selling her entire holdings.
The two companies acquired 122,894,000 ordinary shares (61, 447, 000 shares each) at prices ranging from Rs 21.80 to Rs 22.00 per share.
Commenting on the sale, Otara Gunewardene said that she and her family members Ajit Gunewardene and Ruchi Gunewardene have disposed all their shares in Odel PLC to the Softlogic Group.
"I believe that the sale of our shares to the Softlogic Group was in the best interests of Odel PLC, and a natural progression to its continued growth. Having been nurtured from a simple retail operation from a car boot into one of the largest retail businesses in Sri Lanka during the last 25 years, Odel PLC now needs to move to the next level of retailing in order to be competitive, locally and globally. This requires the entry of a larger player with a deep commitment to retailing: which I believe can best be provided by the Softlogic Group which has a proven history of dynamism and perhaps an unrivalled track record of such operations in Sri Lanka."
She also revealed her decision to sell out of the company and said, "My decision to sell out of the company is also based on my personal desire to focus on another passion I dearly treasure in life: the pursuit of a mission to ensure the welfare of animals and the development of the Embark brand which funds such programmes. The sale of my shares in Odel PLC will hopefully provide me with more time and energy to devote to these activities in the future."
In 2012, Singapore based listed firm Parkson Retail Asia Limited purchased a 41.82% stake in the company for Rs 1.42 billion.
Pathirage told Ceylon FT that Softlogic had no immediate plans for expanding the Odel brand overseas.
Odel first opened its doors in 1989 at Dickmans Road, Colombo 4 before going on to establish its iconic flagship store at Alexandra Place in 1996.
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"Softlogic purchased the shareholdings of Odel founder Otara Gunewardene, and brothers Ajith and Ruchi Gunewardene, in a groundbreaking transaction, which gives the Group 45% ownership in Odel, paving the way for it to assume control of the fashion retailer," the bank said in a statement.
"In his vision, Softlogic Group Chairman Ashok Pathirage has focused on the conglomerate becoming one of the leading retailers in the country while being the single largest franchisee of some of the most reputed international brands in the apparel and fashion accessories market in Sri Lanka. The acquisition of Odel gives Softlogic significant lead to retail its multinational brand portfolio through Odel, an immensely popular fashion chain.
Following this transaction, Softlogic is required to make a mandatory offer to repurchase shares from other shareholders of Odel under SEC rules," the bank said.
HNB CEO Jonathan Alles outlined the reasons which led HNB to finance a sizeable and high-profile transaction of this nature.
"It was an ideal opportunity to demonstrate the bank's commitment to the Softlogic Group, a valued relationship to the bank. This acquisition is a milestone achievement and we take considerable pride in ensuring that local entrepreneurs who are farsighted and visionary are supported fully. Therefore, the value and benefit delivered to all parties through the successful execution of this transaction is, rewarding for the bank," he said.
Softlogic Holdings PLC and Softlogic Retail (Private) Limited (a subsidiary of Softlogic Holdings PLC) on Thursday acquired a 45.16% stake of Odel PLC for over Rs 2.7 billion, with the fashion retailer's Founder Otara Gunewardene, a name synonymous with Odel, selling her entire holdings.
The two companies acquired 122,894,000 ordinary shares (61, 447, 000 shares each) at prices ranging from Rs 21.80 to Rs 22.00 per share.
Commenting on the sale, Otara Gunewardene said that she and her family members Ajit Gunewardene and Ruchi Gunewardene have disposed all their shares in Odel PLC to the Softlogic Group.
"I believe that the sale of our shares to the Softlogic Group was in the best interests of Odel PLC, and a natural progression to its continued growth. Having been nurtured from a simple retail operation from a car boot into one of the largest retail businesses in Sri Lanka during the last 25 years, Odel PLC now needs to move to the next level of retailing in order to be competitive, locally and globally. This requires the entry of a larger player with a deep commitment to retailing: which I believe can best be provided by the Softlogic Group which has a proven history of dynamism and perhaps an unrivalled track record of such operations in Sri Lanka."
She also revealed her decision to sell out of the company and said, "My decision to sell out of the company is also based on my personal desire to focus on another passion I dearly treasure in life: the pursuit of a mission to ensure the welfare of animals and the development of the Embark brand which funds such programmes. The sale of my shares in Odel PLC will hopefully provide me with more time and energy to devote to these activities in the future."
In 2012, Singapore based listed firm Parkson Retail Asia Limited purchased a 41.82% stake in the company for Rs 1.42 billion.
Pathirage told Ceylon FT that Softlogic had no immediate plans for expanding the Odel brand overseas.
Odel first opened its doors in 1989 at Dickmans Road, Colombo 4 before going on to establish its iconic flagship store at Alexandra Place in 1996.
www.ceylontoday.lk
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