Swiss firm to take up 33% stake in Tess Agro for Rs. 84 million via private placement
A 33% stake of Sri Lanka’s Tess Agro PLC is to be taken over by IPEK S.A. Swiss for Rs. 84 million via a private placement.
IPEK is a diversified group of companies involved in oil trading, engineering and waste recycling and is now looking at entering the food industry. It is in this backdrop that the Company has expressed interest in investing in Tess via a private placement.
The private placement will be at 50 cents per share and is subject to approval from Sri Lanka’s Securities and Exchange Commission, the Colombo Stock Exchange and shareholders at an EGM, local media reports stated.
According to reports, the current stated capital of Tess Agro is Rs. 407.8 million, represented by 339.8 million voting shares and 50 million of non-voting shares.
Tess has reportedly stated that proceeds from the private placement will be used to fund a tin can manufacturing project for exports.
Net assets value per share of Tess is 25 cents as of 30 June 2021, whilst at the end of FY21 it was 29 cents.
In FY21, Tess Agro turnover was recorded at Rs. 8.4 million, up from Rs. 6.2 million in the previous year while gross profit was Rs. 1.3 million as against Rs. 0.17 million in FY20.
The investments by foreign businesses/investors in local companies is indicative of the growing business potential in Sri Lanka. The island is fast emerging as a business destination in the South Asian region supported by the country’s geographical positioning in the Indian Ocean and the many trade agreements as well as concessions enjoyed by Sri Lanka. The country’s economy has shown great resilience amidst the Covid pandemic and is also engaged in an aggressive development programme covering all key economic sectors. Sri Lanka’s growth momentum has expanded many business/investment opportunities in all key economic sectors. Foreign businesses/investors could therefore look at the growing opportunities in Sri Lanka.
|Article Code :||VBS/AT/23092021/Z_2|