Aitken Spence Plantation Managements goes for Rs. 559 m worth share buy-back

Aitken Spence Plantation Managements has announced a shares repurchase move worth Rs. 559 million.

The maximum number of shares to be re-purchased will be 2,662,500 shares at Rs. 21 each.  The proportion in which shares to be re-purchased is one ordinary share for every 8 held.

The quantum of shares amount to 12.5% stake of the Company. Aitken Spence owns 38.95% stake followed by M.J.F. Holdings (32.85%) and D.A. de S. Wickremanayake (16.42%). The public float of the Company as at 31 March 2023 was 11.78% held by 108 shareholders.

Aitken Spence Plantation Managements said the objective of the repurchase offer is provide the shareholders with a return that is linked to and reflective of the fair value of their shares (given the price at which shares of the Company are traded on the Colombo Stock Exchange at present is not reflective of the actual value of the shares of the Company) whilst also enabling any shareholder who wishes to exit from their investment in the Company at this stage, to do so (in the context of the fact that the Company is currently not in compliance with the minimum public holding requirements stipulated by Rule 7.14 of the Listing Rules of the Colombo Stock Exchange.

The Company is still evaluating the rectification options to meet the said minimum public holding requirements.

The shareholders will be given the opportunity to tender for repurchase by the Company, additional shares over and above their pro-rata entitlement, which may be repurchased by the Company, at its absolute discretion, in the event that any of the shareholders do not accept the offer in full and as a result, the total number of shares accepted by the shareholders pursuant to the offer is less than 2.66 million.

The Board of Directors of the Company has resolved that the repurchase of shares is in the interests of the Company and that the terms of the repurchase offer and the consideration to be paid for the shares, in the opinion of Auditors, KPMG, Chartered Accountants, is a fair value.

In FY23, the Company’s shares traded at a high of Rs. 71 and a lowest of Rs. 56.80, which was also the closing price.  Net assets per share as at end FY23 was Rs. 35.70 down from Rs. 38.91 from the previous year.

The Company owns 61.64% stake in Elpitiya Plantations, and the Group includes EPP Hydro Power Company Ltd., and yet to be operational Water Villas Ltd., and Escape Parks Ceylon Ltd.