Financial Times

Ceylon Leather Products to go public
Ceylon Leather Products Limited (CLPL), which started by making boots at its Mattakkuliya factory for the army during World War 2 and today is well known for its DI brand, plans to go public. It has announced an initial public offering of 2.5 million ordinary shares at a par value of Rs. 10.

The issue, managed by the Merchant Bank of Sri Lanka, will open on July 16 and close on August 4 or on the market day on which the issue is oversubscribed. CLPL is owned by S. A. Perera and Co Ltd, a company with a long history in the leather trade, having been set up in 1903. S.A. Perera acquired the government's controlling stake in CLPL in 1991 under the privatization programme.

CLPL made a profit before tax of Rs. 16.8 million last year, up from Rs. 11.6 million the year before, according to audited figures. Turnover last year was Rs. 431 million.
It reported an annual sales growth of 21 percent last year. The company accounts for about 65 percent of leather exports from Sri Lanka. It plans to increase its exports to 31 percent of total company sales compared with 18 percent now.

CLPL, originally the Ceylon Leather Products Corporation, operates Sri Lanka's largest tannery with an annual installed capacity of 483,000 square metres of leather. The largest supplier of leather to the local market, it is also a big exporter of leather to the United Kingdom, India, and Greece.

The company's current issued share capital is 10 million ordinary shares of Rs. 10 each. After the IPO, 12.5 million ordinary shares of CLPL are to be listed on the Colombo Stock Exchange. Brokers said they expect investors to show interest in the IPO given the current bullish trend on the bourse.

Ceylon Leather Products currently manufactures and trades in leather, leather footwear and leather goods. It has three production facilities, a tannery where leather is made from raw hide and skins, a shoe factory and a leather goods factory manufacturing all types of leather products other than footwear.

The company's origin goes back to 1939. The government established its first shoe factory at Mattakkuliya in 1942 to manufacture boots and accessories for the armed forces. After World War 2 the factory diversified its production to manufacture shoes for the local and export market. CLPL established another new shoe factory in Sri Lanka in 1962, followed by the country's largest tannery in 1970. Another production line was established two years later to manufacture leather goods such as travel and office bags and waist belts.

Pramuka’s Rohan Perera still missing
By Quintus Perera
While the Pramuka Bank case has gone before the Supreme Court, after the Appeal Court ruled in favour of the depositors who want the Central Bank to try to revive the bank, the whereabouts of Rohan Perera, its president and CEO remains a mystery.
Udaya Nanayakkara, Pramuka's current chairman, told The Sunday Times FT that he was unaware of Perera's whereabouts. Nanayakkara, however, had told a meeting of the bank's directors on December 13 last year that he knew where Perera was and that he could be reached if necessary.

Nanayakkara said that Rohan Perera used to contact senior management of Pramuka Savings and Development Bank by e-mail. Criminal Investigations department director Sisira Mendis said that they were proceeding with investigations to trace Rohan Perera but had still drawn a blank. Rohan Perera's lawyers, Paul Ratnayake Associates, indicated that he was probably in London but could not confirm it.

The Central Bank has challenged the July 2 decision of the Appeal Court cancelling the Monetary Board decision to revoke Pramuka's banking licence and consider options other than liquidation to protect the interests of the depositors.

The Supreme Court on July 7 requested the Monetary Board to recognize that the matter affects the lives of many thousands of innocent people, and that liquidation would have a terrible effect on faith and stability in the financial system. The Supreme Court made order suspending the restoration of the Pramuka banking licence until July 21 when the matter will be taken up.

The Monetary Board was to take steps to merely suspend the operations of Pramuka and proceed immediately to take all diligent steps to give effect to the relief granted by the Appeal Court.

When it was brought to the notice of the Supreme Court that the Central Bank Governor A.S. Jayawardena was not considering the restructuring proposal by the depositors, counsel for the Monetary Board agreed to advise the Central Bank to consider this proposal as a restructuring option.

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