Sri Lanka Ports Authority to arrange funds for project

The Sri Lanka Ports Authority (SLPA) will increase its current stake of 15% by 6.5% through the purchase of a number of shares of Aitken Spence (AS) for which percentage it would have to raise funds to finance the project.

SLPA Chairman Dr. Priyath Bandu Wickrama told the Business Times that in keeping with the shareholders agreement SLPA can increase its shares by 6.5% after purchasing a part of the AS shares divided on a pro rata basis between the remaining shareholders. AS pulled out last week from the project. While he did not want to mention a time when these shares would be purchased he noted that the offer to sell the shares was carried out by AS following the procedure stated in the shareholder's agreement. It is learnt that all the shares of AS were offered to China Merchant Holding (CMH) who had agreed to buy it. However, with the SLPA now increasing its stake the government would have to arrange funding for the 6.5% of shareholding to finance the proj- ect, Dr. Wickrama explained. He noted that while the pull-out of AS had no impact on the project, the government would be compelled under the shareholders agreement to arrange for funding the project. When financing the project, the shareholders had to find a suitable financing agency to obtain funding for a certain amount; but the rest of the funds had to be provided by the shareholders. But with the current turn of events the SLPA will in the future have to arrange for the financing of the project as well, he said. Dr. Wickrama said that while this was not discussed, the required funds would be provided by either obtaining a loan, through its own resources or raising funds.