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Friday, June 3, 2011

Vallibel One Rs. 500 m IPO up for grabs from 9 June

The Rs. 500 million worth Initial Public Offering of Vallibel One Ltd. (VOL) will be up for grabs for investors from 9 June whilst its official opening is on 21 June.

VOL is the first holding company of business tycoon Dhammika Perera, consolidating his personal and controlling/strategic stakes in Royal Ceramics, LB Finance and Sampath Bank as well as an upcoming luxury resort in Negombo. VOL also has interests in renewable energy projects.

The IPO involves 20 million ordinary voting shares priced at Rs. 25 each, which was the same price at which VOL had a private placement early this year to raise Rs. 4.9 billion via issuance of 196 million shares. The latter was not only the biggest ever private placement but was a sell-out with Rs. 7.5 billion worth of applications received.

Post-IPO Dhammika will own around an 80% stake in VOL, which is steered by a Board of Directors involving top professionals.

Acuity Partners, which were managers to the private placement, will function in the same capacity for the IPO as well, bringing its tally of IPOs to three including one as a co-manager.

VOL is a diversified holding company with strategic investments in financial services, tile and sanitary ware manufacturing, and leisure. Sector specific operations are carried out through its subsidiaries, namely LB Finance PLC, Royal Ceramics Lanka PLC and Greener Waters Ltd., the leisure venture arm of the company. Further, VOL holds 15% of Sampath Bank PLC, which is treated as a strategic long-term investment.

The Rs. 4.9 billion private placement was floated to part finance investment of up to Rs. 2 billion in leisure sector projects in Sri Lanka. The company will engage in leisure sector projects through its fully-owned subsidiary, Greener Water Limited., which is investing in a 382-room, luxurious five-star resort to be located in Kochichikade, Negombo.

The hotel will target the high end of the tourist segment and will be positioned as a five star hotel. The starting gross Average Room Rate will be US$ 180 and will increase to up to US$ 220 in the fifth year of operation, as per the private placement prospectus.

Additionally funds raised via private placement will also part finance investments of up to Rs. 1 billion in selected power sector projects in Sri Lanka and part finance investment of up to Rs. 1 billion in other related investments.

Whilst Dhammika Perera is the Chairman and Managing Director of VOL, Nimal Perera is the Executive Vice Chairman. Other Board members are Attorney-at-Law Harsha Amarasekera (Independent Non-Executive Director), banker Kimarli Fernando (Independent Non-Executive Director), Senior Partner and Country Head of KPMG Ford Rhodes Thornton & Company Rajan Asirwatham (Independent Non-Executive Director) and LB Finance Managing Director Sumith Adhihetty (Non-Executive Director).

source - www.ft.lk