A big deal in Sathosa Motors where Access Engineering acquired 60% control, buying out Japan’s Itochu Corporation for Rs.846 million paying Rs.235 a share, dominated trading on the Colombo bourse yesterday.
The market posted a turnover of nearly Rs.1.7 billion, down from the previous day’s Rs.5.86 billion, with both indices moving up – the All Share by 26.42 points (0.49%) while the Milanka was up 25.41 points (0.54%) with 121 gainers outpacing 92 losers.
In addition to the deal in Sathosa Motors, there were substantial trading in Lanka Lubricants closing Rs.3.60 up at Rs.175, JKH gaining 50 cents to close at Rs.175.50 on over 0.2 million shares, Lion up Rs.2.10 to Rs.199.90 on over 0.1 million shares and Aitken Spence down 50 cents to Rs.115 on nearly 0.2 million shares.
"Over Rs.1 billion of the day’s turnover was accounted for by crossings – Sathosa and others," a broker said. "The market started slow and moved somewhat following the Sathosa deal."
Acess will now have to make a mandatory offer to minority shareholders of Sathosa at the Rs. 235 price, brokers and analysts said. The acquisition has triggered the mandatory offer rule.
Access Chairman Sumal Perera has been Chairman of Sathosa Motors from around 1998 as the nominee of Itochu with whom he has had a long trading relationship.
Perera said yesterday that the acquisition was an opportunity for diversifying Access which is focused on construction and engineering and also owns a valuable building, Access Towers, on a prime Dr.Colvin. R. de Silva Mawatha (Union Place)location.
Sathosa Motors was spun out of what was originally the CWE’s motor division which held the Isuzu agency in Sri Lanka which Sathosa Motors, a high dividend paying company, continues to hold.
Itochu will continue to be Sathosa Motors’ partner shipping Isuzu vehicles and spares to the Sri Lanka company, Perera said.
During his tenure as chairman of the company, the Sathosa share issued at Rs. 15 when the company was privatized, has grown strongly in value with shareholders, principally Itochu, benefiting from a two for one bonus as well.
Regnis which had demonstrated substantial price gains in recent weeks announced a final dividend of Rs.6 per share for 2011 XD from March 12 with payment on March 20 while Singer Industries where the share price has similarly moved up sharply announced a final dividend of Rs.8.75 per share for 2011 XD from March 12 and with payment on March 20.
The parent, Singer Sri Lanka will pay a final dividend of Rs.6 per share for 2011 XD from March 12 and with payment on Marc h 20.
James Finlay announced a final dividend of Rs.1.50 per share for 2011 following shareholder approval at a March 28 AGM. The share will trade XD from March 29 with payment on April 9.
Beruwela Walk Inn announced that after prolonged negotiations it has received a final settlement payment from its insurance broker of Rs.104.7 million for property damaged claim following the December 2004 tsunami.
A total of Rs.105.1 million had been received earlier from the insurer in 2005 and 2006 with total final settlement from the tsunami claim adding up to Rs.209.8 million against an original claim of Rs.215.5 million plus interest.