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Friday Nov 15, 2024
Tuesday, 29 January 2013 01:03 - - {{hitsCtrl.values.hits}}
The Board of Directors of Kotagala Plantations has resolved to raise Rs. 360 million via a Rights Issue to settle bank borrowings and boost working capital.
Funds will be raised via a Rights Issue on the basis of one share for every four held at Rs. 45 each. It will involve issuance of 8 million new shares.
The company said Rs. 300 million will be used to settle bank borrowings and the balance Rs. 60 million as working capital requirements.
The Board maintains that the consideration for which the shares to be issued is fair and reasonable whilst the Rights is subject to regulatory and shareholder approval as well.
Kotagala’s stated capital is Rs. 320 million and the Rights Issue is not underwritten.
Midst the announcement, selling pressure weighted heavy in Kotagala Plantations as the counter saw its price eroding sharply by 17.4% to close at Rs. 64.7.
As at September 2012, Kotagala had Rs. 439 million as short term interest bearing borrowings, up from Rs. 249 million a year earlier. Long-term borrowings were Rs. 1.02 billion. Accumulated profits as at 30th September 2012 were Rs. 2.05 billion. Net asset per share was Rs. 81.87, up from Rs. 66.50 a year earlier.
In the first six months of 2012/13 financial year, net financing cost amounted to Rs. 124 million, up from Rs. 51 million in the corresponding period of last year. Net profit amounted to Rs. 212.5 million, up from Rs. 95 million.
Lankem Group holds a 68% stake in Kotagala Plantations whilst the Secretary to the Treasury holds 12%. Kotagala has 12,642 shareholders out of whom 12,325 are those holding between 1 and 1,000 shares and a further 241 under less than 10,000 shares ownership category.
