Softlogic in Rs 3.3B offer to acquire balance Odel stake

By Mario Andree

Ceylon Finance Today: Softlogic Holdings and one of its subsidiaries, Softlogic Retail, prepare to invest another Rs 3.3 billion to acquire 100% control of Odel, after purchasing 45.16% stake for Rs 2.7 billion from Otara Gunewardena and her siblings.

Softlogic Holdings and Softlogic Retail acquired 122,894,000 ordinary voting shares (61,447,000 each) at a price ranging from Rs 21.80 to Rs 22 per share from Otara, Ajit and Ruchi Gunewardene.

To acquire the balance 149,235,431 shares, the two companies have submitted a mandatory offer at a price of Rs 22, the highest price paid to acquire the 45.16% stake in Odel.

Soft logic holdings will acquire 74,617,716 remaining shares while the balance 74,617,716 shares in circulation will be absorbed by Softlogic Retail.

Odel became the first fashion retail business to be listed on the Colombo Stock Exchange with an IPO of 16.7 million shares, an 11.52% stake in its equity in July 2010.
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Colombo Pharmacy Company goes into real estate with new name IC Drug Stores ceases operations

By J. Kurukulasuriya

Ceylon Finance Today: During the year under review the pharmaceutical operations of Colombo Pharmacy Company – which owned the iconic landmark 'IC Drug Stores' at Bambalapitiya junction, were completely discontinued and the company is now engaged in real estate dealings as its principal activity, and is known as Colombo City Holdings PLC.

A significant event which has occurred after the reporting date was that a third party has confirmed purchase of the land and building located at No.740, Galle Road, Colombo 4, at a consideration of Rs 206,625,000. The company has already received an advance from the buyer to confirm this transaction.

The name of the company changed from 'The Colombo Pharmacy Company PLC' to 'Colombo City Holdings PLC' on 3 July 2013. Incorporated in 1913, it is certainly one of the oldest listed companies on the Colombo Stock Exchange and the share was being traded as early as in the 1950s, but it re-registered under the Companies Act No. 7 of 2007, on 13 August 2007.

"Dispensing chemists and acting as retail dealers in pharmaceuticals operation ceased during the period", says the company in its annual report for 2014. At present, all the items of Statement of Financial Position, which were used in the Pharmaceutical business have been transferred to the new business activity. Further, some of the furniture and fittings are being used for the new business activity and some were disposed of.

The most recent revaluation of the company's land and buildings was on 31 March 2012, by Chulananda Wellappili Independent Incorporated Valuer. The land at Bambalapitiya was valued at Rs 113 million, and the Building at Rs 8,465,000. According to the significant assumptions used by the valuer in the years 2014 and 2013, land and buildings (Union Place, Colombo) have a market value of Rs 7,000,000 per perch at 31 March 2014.

"The management decided to change the original purpose of other capital reserve and revenue reserve. Hence, such reserves with an aggregate value of Rs 547,192,613 have been transferred to 'retained earnings' during the year," says the annual report.

The company made a profit for the year of Rs 47,545,371, up 13% from the previous year's Rs 41,906,904. The company's revenue consists of a rental income of Rs 45.9 million from investment property, up 115% from the Rs 21.3 million of the previous year.

Property, plant & equipment with a cost of Rs 1,127,964 have been fully depreciated and continue to be in use by the company.

The company has a stated capital of Rs 11,137,505 consisting of 1,272,857 fully paid ordinary shares. There are 1,534 shareholders. Lanka Century Investments PLC., holds 66% of the shares while others hold less than 3% each. J. E. Costa and H. E. B. De Mel, are the major individual shareholders.

The highest value per share recorded during the period was Rs 690 and lowest Rs 426. The share traded at Rs 640, at the end of last week.

The company has seven directors, six of whom are non executive directors, and two over the age of 70.
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Sri Lanka stocks end steady; energy price cut boosts sentiment

(Reuters) - Sri Lankan stocks ended little changed on Wednesday as gains in mid-cap shares were offset by profit-taking in some large-caps amid heavy retail participation on positive sentiment after the government reduced energy prices.

The main stock index edged up 0.04 percent, or 3.10 points, to 7,179.20. The bourse hit its highest close since June 10, 2011 of 7,218.68 on Friday.

"There is heavy retail participation as the energy price reduction is seen as a positive development. But there was profit-taking in over-valued large-cap shares," said Dimantha Mathew, manager research, at First Capital Equities (Pvt) Ltd.

Sri Lankan President Mahinda Rajapaksa cut energy prices across the board on Tuesday after officially opening a $1.35 billion Chinese-financed 900 MW coal power project.

The cut in energy prices would help reduce manufacturing costs, analysts said.

Brokers expected the market to continue its bullish run on foreign buying, low interest rates and good earnings expectations, despite profit-taking in some counters.

Yields on treasury bills fell 3-4 basis points at a weekly auction on Wednesday.

The index has gained 21.42 percent so far this year.

The bourse has been in an overbought region since July. The Relative Strength Index, a momentum indicator tracked by chartists, rose to 80.087 on Wednesday compared with Monday's 79.164, Thomson Reuters data showed.

Stocks are deemed "overbought" above the 70-mark, signalling a reversal in the near term.

Shares in leading fixed-line telephone operator Sri Lanka Telecom Plc, which led the overall gain in the index, rose 1.51 percent to 53.90 rupees, while large-cap Nestle Lanka Plc fell 2.34 percent to 2,070.10 rupees.

The day's turnover was 2.18 billion rupees ($16.73 million), more than this year's daily average of 1.25 billion rupees.

Foreign investors were net buyers of 424.3 million rupees worth of shares on Wednesday, extending the year-to-date net foreign buyers of 10.88 billion rupees. 

($1 = 130.2700 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)

Sri Lanka Treasuries edge lower

Sep 17, 2014 (LBO) – Sri Lanka's Treasuries yields dropped across maturities at Wednesday's auction with the 6-month yield falling 4 basis points to 6.23 percent, data from the state debt office showed.

The 3-month yield fell 3 basis points to 6.15 percent and the 12-month yield also dropped 3 basis points to 6.26 percent.

The debt office said 1.17 billion rupees in 3-month bills, 4.80 billion in 6-month bills and 4.25 billion in one year bills totaling 10.22 billion rupees were sold after offering 5.00 billion for rollover.

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Sri Lanka stocks close higher

Sep 17, 2014 (LBO) - Sri Lanka's stocks closed higher Wednesday amid strong foreign buying, brokers said.

The Colombo benchmark All Share Price Index closed 3.10 points higher at 7,179.20, up 0.04 percent. The S&P SL20 closed 0.05 points higher at 3,976.81.

Turnover was 2.18 billion rupees, up from 2.06 billion rupees a day earlier with 90 stocks closed positive against 109 negative.

John Keells Holdings closed 10 cents higher at 258.00 rupees with seven off-market transactions of 350.81 million rupees changing hands at 258.00 rupees per share contributing 16 percent of the turnover.

The aggregate value of all off-the-floor deals represented 25 percent of the daily turnover.

Lanka IOC closed 3.10 rupees lower at 44.40 rupees and Piramal Glass Ceylon closed 20 cents higher at 4.80 rupees, attracting most number of trades during the day.

Foreign investors bought 710.13 million rupees worth shares while selling 285.78 million rupees worth shares.

Lion Brewery Ceylon closed 19.70 rupees higher at 635.00 rupees and Sri Lanka Telecom closed 80 cents higher at 53.90 rupees, contributing most to the index gain.

Chevron Lubricants Lanka closed 10.00 rupees higher at 341.40 rupees and Nestle Lanka closed 49.90 rupees lower at 2,078.60 rupees.

Lanka Orix Leasing Company closed 10 cents lower at 87.50 rupees.