Sri Lankaâ€™s Hemas group mulls acquisitions with cash pile
COLOMBO (EconomyNext) – Sri Lanka’s Hemas Holdings group says it is looking at “transformational” growth opportunities, having amassed a cash pile through a rights issue and disposal of assets.
Chairman Husein Esufally said that given management’s plans for growth through acquisitions, and investments in new markets, it went for an infusion of fresh capital by way of a rights issue of four billion rupees.
Strong demand for the company’s shares, mainly by foreign institutional investors, prompted the controlling shareholders to forego their rights.
“Proceeds of the rights issue, proceeds from the sale of the power business and our traditionally low gearing, places the company with a healthy cash pool to look at transformational growth opportunities,” Esufally told shareholders in the firm’s annual report.
But he said the Board of Directors will exercise “due care” to ensure that new investments are aligned with the group’s core business and deliver attractive returns.
Hemas Holdings has said the proceeds of the rights issue are mainly to fund strategic investment opportunities in healthcare and personal care and that the firm is looking at growth opportunities in Bangladesh.