ECONOMYNEXT - Sri Lanka's Janatha Estate Development Board (JEDB), an ailing state farming company, is trying to sell a contested prime land in the capital to an investor to raise cash to settle worker's dues, officials said.
Upul Jayasuriya, Chairman of the state investment promotion agency said a private company that now has a long-lease on 24 perches in a 257 block of prime land has gone to court to prevent its sale to a another party.
The firm which runs a workshop on the land in Vauxhall Street in Sri Lanka's capital Colombo.
The BOI was now considering acquiring the land back and calling for a public requests for proposals, Jayasuriya said.
In 2014, the paint company had been offered the land for development at 1,150 million rupees or about 4.3 million rupees a perch on a 99-year lease but they had not bought it or brought an investor, he alleged.
The JEDB and the Board of Investment had then got a fresh assessment in March 2016, from the Government Chief Valuer for 1,400 million or 5.5 million a perch.
However Jayasuriya says due its border with Colombo's Beira Lake, it could be worth 8.0 million rupees a perch or more.
Now a foreign partner had been found for the project who had expressed willingness to pay a higher price of around 7.5 t 8.0 million a perch, Jayasuriya said. However the company in possession was objecting and insisting on the earlier offer at a lower price, he said.
JEDB land had been leased at very low rates to the firm more than a decade ago JEDB Chairman Kennedy Gunawardena said. The ailing state firm did not have enough cash to manage day to day operations.
JEDB also owned workers 1.5 billion rupees in pension contributions, he said.
Selling that land at a market based price would allow the firm to settle its dues, he said. (Colombo/July16/2016)