RCL buys Asia Siyaka

Royal Ceramics Plc (RCL), in a bid to diversify into commodity broking bought Asia Siyaka Commodities Ltd's 51% stake this week, the company said.

“The share transfer was done and the deal was completed at 5 pm on Thursday,” Nimal Perera, Chairman RCL which is controlled by businessman Dhammika Perera told the Business Times. He said that five new directors will be appointed by RCL to Asia Siyaka in a few weeks.

Mr. Perera added that RCL will not go into backward integration (diversifying into similar businesses), but will selectively buy into different businesses. He said that RCL is a cash rich company, but strategically sold its 12.3% stake in The Fortress for Rs. 246 million and 0.5% stake in Hayleys for Rs.137 million to Vallibel One Plc, which is a connected party to Mr. Dhammika Perera's firms to raise money to buy Asia Siyaka. “We did this on Wednesday ahead of Thursday’s sale,” he said, adding that RCL will find synergies between plantations owned by Hayleys Plc and Asia Siyaka.

Meanwhile Hayleys denied a report in last week’s Sunday Times that it was negotiating the purchase of shares of Asia Siyaka. In an announcement to the Colombo Stock Exchange on Wednesday-april 4, Hayleys Chairman Mohan Pandithage, referring to the April 1 news item, said “neither Hayleys nor its subsidiaries were negotiating with Asia Siyaka for purchase of its shares.” The report said the deal was being done through Hayleys director and powerful businessman Dhammika Perera.