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Wednesday, August 3, 2011

PCH Holdings to pay higher for mandatory offer on Orient Garments

PCH Holdings and its Chairman S.H.M. Rishan are to pay a higher price in the mandatory offer on Orient Garments Ltd. (OGL).

On Monday the connected parties picked up a 51% stake in OGL at an average price of Rs. 21.56 per share, but Rishan had bought OGL shares at the highest price of Rs. 28 per share in the past month, hence the directive from SEC based on the latter.

In a related development, Finco Holdings Ltd. said yesterday that its holding in Orient Garments is only 8.4%. This is following it divesting a 52.55% stake or 28.86 million shares at an average price of Rs. 21.56 per share on Monday.

Through the sale, control of Orient Garments was acquired by PCH Holdings and its Chairman Rishan, who picked up a 51% stake at an estimated cost of Rs. 603.5 million.
     
OGL has 54.9 million shares in issue. The cost of acquiring the balance stake will be around Rs. 753 million.
OGL closed the day at Rs. 23.90, up by Rs. 2.10 with half a million shares traded. The 52-week highest of OGL is Rs. 40 whilst the lowest was Rs. 21.50.

Based on sharp movements in prices on Monday, OGL was slapped with a five day 10% price band by the SEC.

source - www.ft.lk

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