Stock Market player/businessman Nimal Perera does it again
As predicted ‘correctly’ by many industry analysts at the onset, Nimal Perera, networth investor, one time close confidante of business tycoon Dhammika Perera and director of many firms controlled by the latter, sold Kalamazoo Systems Plc, dealing in paper accounting ledgers, less than a year after he bought it. In early September last year Mr. Perera bought this firm which was a member of the Ceylon Printers Group for Rs. 35 million and its share price rose sharply to emerge as the highest gainer percentage-wise following news of this takeover at the time. Less than 10 months later on Wednesday he resorted to sell it to Renuka Holdings for almost Rs. 50 million.
The stock touched an all-time high of Rs. 2,000 (when he bought it)before closing at Rs. 1,910, up by Rs. 838.80 or 78 per cent. The lowest price of the share was Rs. 1,716. Being an illiquid stock, only 129 shares changed hands via 43 trades when Mr. Perera bought a 67 per cent stake in Kalamazoo, it was reported. The sellers at the time were Ratnanather family and related parties who held over 40 per cent, CT Holdings Plc which owned 19.5 per cent and related party Ceylon Printers Plc with 3.6 per cent.
Short shelf life
Mr. Perera was also a part of a similar acquisition and subsequent sell off of Asia Siyaka Commodities to Lanka Commodities Ltd in early 2013 for Rs. 371 million, above Rs. 34 million from the original purchase price paid in April 2012 – again less than a year of holding this investment which the same analysts predicted will happen saying that this investment will only have a shelf life of less than a year at the most. They cautioned at the time that it was unwise to ‘fall prey’ to this stock (especially for small shareholders). At the time Mr. Perera who bought this along with the Dhammika Perera-controlled Royal Ceramics (RCL) told the Business Time that RCL (in which he’s on the board)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 per cent stake in The Fortress (a luxury hotel owned by Dhammika Perera in the South) for Rs. 246 million and 0.5 per cent stake in Hayleys for Rs.137 million to Vallibel One Plc, which is a connected party to Dhammika Perera’s firms to raise money to buy Asia Siyaka. In 2013 March Perera was reported as entering into the stock broking industry again together with RCL through a deal to buy 51 per cent control of New World Securities Ltd (NWS). He bought a 32 per cent stake under his personal account whilst RCL purchased a 19 per cent stake, in a move which was described by media as a ‘strategic alliance’. It was also said to be a shareholding restructure at NWS.
The broking firm, set up in March 2011 was at the time controlled by a consortium of Japanese investors-led by Takashi Igarashi. Mr. Perera was widely quoted in media at the time as saying that NWS which was renamed as N Securities Ltd after the purchase would be repositioned as a boutique broking house. He also said that under the new control, NWS hoped to derive benefits from synergies of Pan Asia Bank, LB Finance and Vallibel Finance, (all controlled by the senior Perera) that’re within the financial services industry. But by August of that same year Mr. Perera proved ‘the analysts’ right by negotiating a deal to sell the 51 per cent he owns in N Securities Ltd to Harsha De Silva-led Navara Capital.
According to the Perera camp it was said at the time that this purchase originally was done with synergies because of RCL’s connections with plantations-rich Hayleys PlC. But this hadn’t been fruitful. Mr. Perera continues to hold the Mercantile Produce Brokers Ltd., (MPB) which he bought control of for Rs. 200 million in 2014 October by acquiring a 76 per cent from senior management of MPB. The investment is in his personal capacity through his investment arm Don Wilbert Capital and he appointed two nominees to the MPB Board – Nishantha Wickremasinghe, former chairman of SriLankan Airlines and brother-in-law of the former President, and Royal Ceramics CFO Haresh Somashantha.