CFVF acquires 19.99% of Orient Financial Services

By Jithendra Antonio

First Capital Holdings PLC (CFVF) in a filing to the stock exchange said the company had acquired 19.99% of Orient Financial Services Corporation nearly after five months it was completely bought by People’s Venture Investments (Pvt), an investment arm of Janashakthi group.

First Capital Holdings said the 19.99% or 9.25 million shares of the Orient Financial Services (OFS) was bought for a consideration of Rs.90.465 million. People’s Venture Investments (Pvt) Ltd bought 100% of OFS from United Motors (UML) for a consideration of Rs.230 million in February 2011, according to UML financials. Subsequently as per then financials (February 2011), 20% of OFS was only valued at Rs.46 million.

UML in its annual report says that the sale of OFS came at a time when the Board continuously focused on the two loss making product lines, and they divested the ownership of its fully owned Subsidiary, Orient Financial Services Corporation Limited (OFSCL) to the People’s Venture Investments (Pvt) Ltd. as the highly competitive financial services sector constrained the growth of the Company largely as a result of the inability of banking institutions to provide low cost capital.

Industry sources say that Untied Motors have been contemplating in divesting its leasing business for a while, in order to concentrate more on its core business whilst Orient Financial Services is mainly engaged in Vehicle Leasing and Contract Hire business and is registered under the Finance Leasing Act of Central Bank with an authorized capital of Rs.500 million. It has a issued paid up capital of Rs.125 million.

The company was founded in 2003 and made a profit of nearly Rs. 40 million for the year ended 31st March 2010.

source - www.dailymirror.lk