Thursday, February 16, 2012

Harry buys 8.8% more of LMF for Rs. 350 m; Control tops 50%

Business tycoon Harry Jayawardena-controlled Melstacorp yesterday bought an 8.8% stake in Lanka Milk Foods (LMF) for Rs. 350 million increasing the overall stronghold in the dairy venture to an estimated 50%.

 The purchase included a block of 3.428 million shares via a crossing at Rs. 99 per share whilst overall 8.8% or 3.546 million shares of LMF traded yesterday for Rs. 350.7 million. The price paid by Mesltacorp was 10% premium to the Tuesday’s closing price. The seller was Trading Partners Ltd., connected to Jafferjee Group.

Net Asset Value per share of LMF is Rs. 54 but the highest price of LMF in the third December 2011 quarter was Rs. 138.50 and the closing was Rs. 107.10. Excluding the crossing, the price of other trades hit an intra-day high of Rs. 97 before closing at Rs. 96, up by Rs. 5.90 from Tuesday’s closing.

Deals on LMF produced the highest turnover yesterday accounting for 25% of total.

 Harry J-linked Milford Exports is the biggest shareholder with a 33.57% stake whilst Melstacorp prior to yesterday’s purchase had 5.79% stake whilst its parent Distilleries had 1.9% stake. These combined holdings give Harry J an estimated slightly above 50% control in LMF. The other major shareholder is Mills Enterprises Ltd., which owns 15.3%.

 For the nine months ended on 31 December 2011, LMH saw Group after tax profit swelled to Rs. 225.2 million, from a loss of Rs. 27.6 million a year earlier. Net profit attributable to equity holders of LMF was Rs. 229 million, in comparison to a loss of Rs. 27.6 million. In the third quarter after tax profit was Rs. 50 million as against a loss of Rs. 75 million.

Group turnover had grown to Rs. 4 billion from Rs. 3.3 billion in the first nine months of FY2011.

source - www.ft.lk

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