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Sri Lanka’s Sunshine Holdings boosts stake in tea marketing firm

BRANDED: Watawala Tea is the market leader in Sri Lanka’s branded tea segment. The firm has been taking consumers out of the loose tea market over several years to grow the segment.

ECONOMYNEXT – Sri Lanka’s Sunshine Holdings has boosted its stake in a branded tea company and trimmed the group interest in oil palm farming and dairy, by transferring a stake in Watawala plantations to a new joint venture.

Turnover at Colombo Stock Exchange shot up to 3.6 billion rupees on May 12 with 3.01 billion rupees of Watala Plantations being trade.

Estate Management Services, a unit of Sunshine holdings sold a 75 percent stake in Watawala Plantations to a new joint venture with their partner, Wilmar, an oil and fats specialist, sources familiar with the matter said.

The transaction will see Sunshine gaining full ownership of Watawala Tea Ceylon, a marketing company which owns tea brands including Zesta and Watawala.

The transaction will see Sunshine’s final stake in the plantation and dairy businesses trimmed to 37 percent from 45 percent, market analysts said.

Sunshine has been consolidating businesses in fast moving consumer goods and healthcare while reducing its stake in farming.

The group had earlier exited the tea business by selling out of Hatton Plantations. (Colombo/May12/2020)