Blue Diamonds to call EGM to use Right Issue to pay salaries

(LBO) – Sri Lanka’s Blue Diamonds is to call an Extraordinary General Meeting to obtain approval to use part of their Rights Issue funds to pay staff salaries.

In a stock exchange filing the company that exports diamond studded gold jewellery said some major shareholders agreed to allocate funds for working capital requirements including salaries and welfare, factory maintenance, electricity, water and to clear bank draft.

Objectives of the Rights Issue were establishment of Rs50mn R&D Unit, establishment of Rs30mn Global Design Centre, Rs50mn investment in new machinery, Rs30mn for International Trade Fair and Rs89mn investment in inventory.

So far the company has utilized 55 million rupees for the above objectives.

“However Rs.33mn of the Rights Issue proceeds had been so far utilized for working capital requirement and a further Rs.26mn will be required for future,” the company said.

“Of the balance Rs.50mn, Rs.12mn will be utilized for International Trade Fair participation and Rs.38mn will be utilized for Investment in inventory.”

Even though the company initially not intended to provide funds for salaries, during the past month the board of directors has realized the issue, Blue Diamonds further said.

SOEs to be listed next year

By Ishara Gamage

Ceylon Finance Today: Government is planning to list a few large state-owned enterprises (SOEs) on the Colombo bourse by early next year Prime Minister Ranil Wickremesinghe said.

Speaking at a ceremony to mark the Colombo Stock Exchange's (CSE's) 30th anniversary celebrations which was held at the CSE premises yesterday, he further said that Sri Lanka may have to bring a Contingencies Liability bill to parliament sometime next year to fulfil additional government funding/loan repayment requirements.

"We don't know how much of debt has been left behind us by our predecessors, Parliament has to make recommendations or Parliament must decide how additional revenues are to be raised to pay those expenditures," he said.

He said that building an efficient and transparent stock market is the government biggest dream.

"What we all need is expansion of listed company shareholdings and to attract more and more middle class people to the CSE. In doing so, we need an efficient and transparent stock market. Building integrity is most impotent," he said.

Wickremesinghe was hopeful that the country would be able to overcome several negative external outcomes due to the global economic turmoil.

"We have to expect declining commodity prices that have an impact on the Sri Lankan economy and there will be reduced flows to emerging capital markets. We have got to remind ourselves that there will be pressure on our currencies and there will be increased financial market volatility as far as we are concerned. There is going to be slow e growth in the emerging markets and increasing risk," he said.

Speaking about the controversial Port City project, Wickremesinghe said, "Hopefully if the Port City projects gets underway – there will be some sort of landfill there – that could have the makings of a special financial and business district which will be a unique one in South Asia".

Meanwhile, Sri Lanka Tourism Development Authority Chairman Paddy Vitharana speaking at an event earlier in the week said that the stalled Colombo City Port project will get off the ground next year.

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Hemas Holdings ‘expresses interest’ in buying stake in state-owned Lanka Hospitals Corp.

By Hiran H. Senewiratne

Sri Lanka's diversified conglomerate Hemas Holdings has expressed interest in acquiring a stake of state-owned Lanka Hospitals Corporation.

In a stock exchange filing Friday the company said they have noted the interest expressed by the government in disposing of shares in ventures such as Lanka Hospitals Corporation PLC.

Finance Minister Ravi Karunanayake said in his budget speech recently that some state enterprises will issue their stakes in order to increase private sector efficiency. Therefore, several entities, including Lanka Hospitals, Insurance Corporation and other entities are listed in the Colombo Stock Exchange, keeping the government holding or ownership.

Head of Group Sustainability and Corporate Communications at Hemas Holdings PLC Shiromi Masakorala said as a group, the company has been exploring opportunities in the sectors they operate in.

"We have been in the healthcare sector for a number of years as an innovative leader and have won the hearts and minds of our customers, she said.

The firm expressed confidence in their ability to contribute significantly to Sri Lankan healthcare services. "This was only for an expression of interest to purchase the stake in Lanka Hospitals, nothing concrete has come out, she said.

Healthcare sector of the company recorded revenues of Rs. 8.8 billion, a growth of 32.4 per cent over the same period last year, while the sector's operating profit increased by an impressive 25.1 per cent to reach Rs. 741 million.

Sector revenue was largely driven by the positive performance of the local pharmaceutical distribution business together with the performances of the two hospitals at Wattala and Thalawathugoda.

The pharmaceuticals business posted an 18.9 per cent growth in revenue, strengthening Hemas' market leadership position and increasing its market share to 19.2 per cent.

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