RIL gets access to prime Sri Lanka property with UML buy
ECONOMYNEXT – The acquisition by RIL Property PLC (RIL) of a 30% stake in United Motors Lanka PLC (UML) will give the Sri Lankan property developer access to prime real estate for future development.
“The acquisition of UML further deepens our access to prime properties in Colombo and its suburbs and opens many more opportunities for long term real estate development,” said Hiroshini Fernando, chief executive of RIL.
“Post-acquisition, the strength of UML’s core business operations and strong dividend track record, will also contribute to the overall strength of RIL Group.”
RIL Property acquired the 30% stake in United Motors Lanka from the latter’s major shareholder, M. A. Yaseen on November 8, 2017, for Rs2.36 billion and aims to raise its stake to 51%.
In addition to its core business operations, UML group also owns a significant land bank mainly consisting of lands located in Colombo 02, Ratmalana and Orugodawatta.
The land bank is valued at over Rs4.0 billion, according to a statement by NDB Investment Bank acted as the transaction advisor to RIL. Nithya Partners acted as Legal Advisors to the transaction.
UML property located in Hyde Park Corner in Colombo 2 is adjacent to the property owned by RIL.
RIL owns a significant real estate portfolio of over 600 perches of prime property in Colombo 2 and is the owner, developer and manager of the “PARKLAND”, the 22 storey landmark Grade ‘A’ office building with a gross floor area of 450,000 square feet.
The deal “offers a unique opportunity to unlock the value via a potential joint development by both RIL and UML in the future,” NDB Investment Bank said.
UML, established in 1945, is one of the oldest automobile companies in Sri Lanka with sole distributorships for a broad spectrum of automobiles brands including Mitsubishi, Fuso, TVS, Perodua, JMC, DFSK, MG, Brilliance and Zotye.
RIL is using the funds raised through its public offer for the redevelopment of the “READYWEAR” building and the branch expansion strategy of its BreadTalk operation.
(COLOMBO, November 14, 2017)