Thursday, November 18, 2010

Overseas Realty’s Rs. 4.35 b rights issue fully subscribed

The just-concluded rights issue of Overseas Realty (Ceylon) Plc has been fully taken up by the shareholders of the company.

Overseas Realty, the developer and owner of the World Trade Centre Colombo and the developer of the Havelock City project, offered 281 million shares in the proportion of one Ordinary Share each for every two Ordinary Shares held in the capital of the Company by way of a Rights Issue to holders of issued Ordinary Shares. These shares were issued at a price of Rs. 15 per share, with the objective of raising Rs. 4,217 million.  A total of 290.6 million shares have been subscribed to the value of Rs. 4,359.5 million, making the issue a success.

The funds raised through this Rights Issue was for the Compulsory redemption of the Non Convertible Cumulative Redeemable Preference Shares (NCCRPS) that were issued by the Company and subscribed to by Shing Kwan Investment (Singapore) Pte Ltd.  Shing Kwan Investment is a member of the Shing Kwan Group, the major shareholder of Overseas Realty.

The NCCRPS was taken up by Shing Kwan Investment as part of the restructuring exercise undertaken by the Company in 2005. With the success of the rights issue, the preference shares amounting to Rs. 3,744.6 million have already been redeemed. The balance amount of Rs.472.8 million would be used for the working capital needs of the Havelock City project, Sri Lanka’s single largest mixed real estate development.

Phase 1 of Havelock City, which comprises 226 residential apartments, is complete with residents already in occupation. With the prevailing positive economic sentiment, the company intends to proceed expeditiously with the balance phases of Havelock City.

Construction of Phase II comprising the next two residential towers is scheduled to begin early 2011 along with the commercial development, which would include Sri Lanka’s largest shopping mall. Residents would also enjoy the multitude of facilities the Clubhouse would provide when it is constructed in 2011.

The World Trade Centre, Colombo, which is Overseas Realty’s flagship commercial development, is currently seeing increased occupancy and rental levels reflecting the positive business sentiment. The World Trade Centre remains the ultimate business address in the country providing local and international businesses an unmatched working environment.

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