JV fails due to troubled economy
View(s):A joint venture between a Sri Lankan conglomerate and a US company has failed to kick off due to troubled economic conditions in Sri Lanka, two years after it was set up.
“WAPO and SEAF having given due consideration to the current economic conditions and unfavourable investment environment, have on August 14 mutually terminated the JV agreement on an amicable basis,” according to a notice posted on the Colombo Stock Exchange on Tuesday.
Guardian Capital Partners Plc (WAPO), part of the Carson’s Group, entered into a joint venture with US-based Small Enteprises Assistance Funds (SEAF) on April 28, 2016. The JV was aimed at managing and investing in private equity projects in Sri Lanka.
In the Sri Lanka company’s latest annual report issued in April, company chairman I. Paulraj said: “Progress on the fund raising for the PE fund launched jointly with Small Enterprise Assistance Funds (SEAF) has been extremely slow. No investment commitments have been received so far hence the company is looking at alternate options available together with SEAF and will look to take a decision on the venture very soon. Pending this, fund raising activities have been temporarily discontinued.”