The Perera era: End of an innings
Fibre produced by the Hayley's Group in which Dhammika Perera has a sizable stake.
Someone who always believed in luck, Nimal Perera, a powerful businessman during the Mahinda Rajapaksa-led administration, now says he has ambitious plans to be a politician.
On the back of stepping down from Chairman/Non-Executive Director at two Dhammika Perera-led firms – Horana Plantations and Vallibel One – on Thursday as announced to the Colombo stock market, which followed his resignation on Wednesday as a director of other Dhammika Perera-controlled companies, he told the Business Times that he wants to get into politics.
“I have an idea to get into politics. If time permits and if the ‘environment is right’, then I will get into politics while doing my own business.” The party that he’ll be representing hasn’t been decided, he said adding that it’s because he doesn’t have affiliations to any party.
In a 2012 media interview, he said luck was number one to his success, adding, “I don’t have a MBA nor do I have a degree. I only have my Advanced Level qualification and I am a partly qualified Accountant. I didn’t dream of sending my children to international schools or even to Royal. That is luck. They also have the luck to be my children. When I first came to Colombo I did not even have a trouser to wear. If you have luck you can’t stop or block the path you are meant to travel,” he added noting in the same breath, “But my sons are studying in the US that is luck. Then come commitment, dedication, integrity and honesty. Those are the five factors. Luck is the number one.”
So then what happened – as per the fall out of the Pereras? They say that luck has a way of evaporating when you lean on it.
According to many, the Perera split was in the making, as far back as two years ago when Dhammika Perera did his large acquisitions such as Amaya Beach, a stake in Nawaloka and his hotel foray into Maldives without his then “right hand man’s” assistance. But it came to a boiling point on Monday at a board meeting of Royal Ceramics PLC (Rocell) a firm controlled by the senior businessman, also its chairman and managed by Nimal Perera.
Fireworks
“At this meeting in the presence of about 20 people that included some female staff at Vallibel One, Rocell and all board members, Dhammika created a situation where Nimal had no choice but to resign,” a source privy to the meeting that day told the Business Times.
The source added that Dhammika berated his junior business partner, drawing inferences and references to incidents in the past that Nimal was involved in different firms that he was managing, to which the latter was stunned and only mumbled, “Oya monawada Kiyanne?” (loosely translated into English as, what’re you going on about?).
The source added that it was different things the senior business partner wasn’t happy with and not about ‘fraud’ as is widely speculated. “It was more about Nimal doing things that Dhammika wasn’t happy with”. He said that for the most part Nimal had kept mum and listened to the berating. Nimal had resigned on Tuesday from some firms and on Wednesday it was circulated to the market.
On Wednesday he left Hayleys, Haycarb, Kingsbury, Amaya Leisure and Talawakelle Plantations, and also as Managing Director of Royal Ceramics. In 2012 Nimal had said that his senior implicitly trusts him and that both of them together are in for a longer partnership. It was their 17th year when they disbanded.
The duo, led by Dhammika Perera, was widely credited for unconventional forays into powerful businesses culminating with the virtual take-over of the Hayleys Group. Interestingly Nimal doesn’t own a single share in the firms that he resigned from.
Nimal insisted to the Business Times that it’s only the business relationship that was terminated. “I don’t have an issue with Dhammika – it’s only the business relationship that we parted from.” But the market is skeptical.
Rags to riches
His story as he always claims is a rags to riches one. After completing his education at Pinnawala Central College in Rambukkana, Nimal began conducting private tuition classes in Panadura, Kalutara and Moratuwa for Advance Level and Ordinary Level students while joining the Institute of Charted Accountants to follow accountancy and then joined the Sri Lanka Technical College to do higher national diploma in accountancy, following which he started working.
Nimal completed articles in accountancy at Tudor V & Co, where he worked for four years, and thereafter worked as an accountant at Bartleet, Union Trust and Investments, Sherman Sons, and from there to Pan Asia Bank in marketing. Nimal says his entire life changed at Pan Asia Bank when he met Dhammika by accident through a mutual friend since the major businessman was interested in taking a stake in Pan Asia Bank.
When Dhammika took over the majority share, Nimal has said that he could no longer work as an employee at Pan Asia due to the power and authority that he had through this acquisition that he assisted Dhammika with and therefore, he had resigned.
This duo first acquired Amaya Leisure, (earlier Connaissance de Ceylan) for Rs. 120 million. Then went on to Royal Ceramics, LB Finance and Hotel Reefcomber, (now known as Citrus, but disposed stakes in this hotel), acquired Horizon Hotel (now Fortress), acquired a strategic stake of almost 25 per cent in Asian Alliance (now sold). Their first IPO was Vallibel Power Erathna and the next acquisition was Vallibel Finance, (earlier Rupee Finance).
Nimal planned the acquisition of Hayleys in such a way so that things would happen in their favour, he has said publicly. “The first 10 per cent was acquired after a chat in the gym, with this 10, we were able to take over another 10 per cent.”
Board resisted
The board was resisting the duo as they never wanted them. “Nimal had then strategised to take over the majority stake; managing to obtain one seat on the board for Dhammika, then he had got into the board and they were able to change the powerful chairman and director of finance and gradually take over the remaining shares,” the source said. Then he had strategised on how to take control of the board by appointing friendly directors – those who supported them to take control of the board. Their last big acquisition was Delmege.
Nimal had acquired George Steuarts with Dilith Jayaweera, another powerful businessman during the Rajapaksa regime, but had disposed his stake with a substantial gain to Mr. Jayaweera as the latter had wanted the controlling stake of George Steuarts.
Time and again he has praised former President Mahinda Rajapaksa, former Defence Secretary Gotabaya Rajapaksa and the commanders of the three forces who created a conducive environment for people like him who have come from the village without any connection to the Colombo society to grow. The stock market was dominated and controlled by people who considered themselves as the elite, he always said, adding that he was able to break that ‘monopoly’ and rise to his current position.
His forays during the Rajapaksa era in the stock market earned him membership in an exclusive club dubbed as “the mafia” at the time. He was under the aegis of the then president’s son Namal Rajapaksa – who he has praised for being energetic. Now that relationship has also gone sour. It’s so bad that as Nimal is believed to have turned state witness against Namal in a FCID case.
He has said in the past that there are those who think the two Pereras are in dispute and that they have a problem in their relationship. “But there is no such thing and we laugh at those people. We are in touch with each other every day. Our relationship is built on a different formula. I disclose everything to Dhammika in my life. It is easy to destroy a relationship, but it is very difficult to build one. That has happened in the past to others. Our relationship is very strong today and it will be so in the future. Even if I receive a corporate gift I always tell him as someone else can always make a story out of it. That is why this relationship is so strong,” he has reportedly said.
Currently Nimal feels otherwise. “In any relationship, in any marriage this can happen,” he stressed to the Business Times.