Sri Lanka’s Watawala Dairy gets US$ 2 million investment from Japan’s SBI Group
One of Sri Lanka’s leading agribusiness companies, Watawala Plantations PLC, has reportedly announced that SBI Ven Holdings Ltd. has invested US$ 2 million in Watawala Dairy Farm through Watawala Dairy Ltd. (WDL).
According to reports, the investment will further propel Watawala’s dairy operations in the country and contribute to the economy by committing to the Government’s effort to promote local milk production and towards the goal of achieving self-sufficiency in milk.
Furthermore, Watawala Plantations plans to utilise the investment to expand the herd (to reach 1,000 milking cows), further improve its infrastructure to function at optimal levels and strengthen the upstream value chain, local media reports stated and the strategic venture is to offer SBI Ven Holdings an 11% stake in Watawala Dairy.
Watawala Plantations, in the meantime, will invest Rs. 296 million to settle inter-company debt and strengthen the balance sheet of WDL. SBI Ven is the overseas private equity firm of SBI Holdings Inc, the Daily FT reported.
The state-of-the-art dairy farm by WDL is a Board of Investment (BOI) of Sri Lanka registered project situated in Watawala, Ginigathhena. The project had commenced in March 2016 as a pilot project called ‘Lonach Farm’ with 120 cattle, three cow houses and a milking parlour. Today, the farm manages a herd of 1,600 dairy cattle, where 800 are milking cows.
Using an ultramodern milking parlour system, the farm currently produces around 18,000 litres of fresh milk per day and 540,000 litres per month. Annually, the farm releases 6.5 million litres of milk to the local market, which is 3.5% of the annual Sri Lankan milk production, local media reports further noted.
Watawala Plantations Chief Executive Officer Binesh Pananwala has been quoted as saying, “At a time when investor confidence and sentiment have been greatly affected, SBI Ven Holdings’s investment on Watawala Dairy Ltd. brings in vital Foreign Direct Investments (FDI) to Sri Lanka when it is much needed in the market and the economy.
“This strategic investment not only paves a path for us to support the Government’s vision to promote local milk production and achieve self-sufficiency in milk by 2025, but also validates our long-term vision and investor-friendly corporate governance framework, helping us to build confidence and attract leading global equity firms like SBI Ven Holdings.”
Sri Lanka’s dairy industry has presented many business/investment opportunities with the authorities being committed to increasing the country’s dairy milk production. Sri Lanka is working towards reaching self sufficiency in dairy milk. This has expanded business/investment opportunities in Sri Lanka’s dairy milk industry.
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