Sunday 15 November 2015

JKH warrant conversion to infuse Rs. 8 bn. zero cost cash into company

JKH’s 2015 warrant conversion into shares concluded last week was expected to be nearly fully taken up infusing approximately eight billion rupees to the company keeping cash flows into the ongoing mega Waterfront development project going smoothly.

"We’re still counting with cheque realizations to be accounted for," company sources said. 

"Unlike in a rights issue, there was no opening for application for additional shares so what won’t be taken up will be warrants of dead people or those tied up in testamentary cases or a few who may have forgotten or not filled the forms."

"Given that the warrants had value, those who didn’t want to convert to shares could have sold the warrants," an analyst explained. "Those who kept them would have converted. Though the warrant price came down on the last lap they traded at over Rs. 50 each some months ago and there is a nice difference between the conversion price of Rs. 161.80 and the prevailing share price of Rs. 184."

There is significant foreign shareholding in JKH whose largest shareholder is Mr. S.E. Captain who held 10.5 percent of the company with a further 8% held by Paints and General Industries which he controls according to the company’s September financials.

JKH’s Chairman Susantha Ratnayake, Deputy Chairman Ajith Gunawardene and Finance Director Ronnie Pieris are substantial shareholders although not on the top twenty list.
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