Sunshine sheds tea plantations
Sunshine Holdings PLC, following the sale of its tea business to a Singapore-based firm, will focus on healthcare and consumer goods businesses.
Group Managing Director, Vish Govindasamy in a statement said the sale of control of Hatton Plantations to Lotus Renewable Energy (Pvt) Ltd was part of a strategy to re-focus and specialise on healthcare and consumer segments.
Sunshine created Hatton Plantations in September 2017 to carry out the upcountry tea business of Watawala Plantations and listed it last year in a strategic move to separate the tea business from the more rewarding oil palm business of Watawala Plantations PLC. The new unit, Hatton Plantations which has 14 estates located in the Central Province with over 5,000 hectares of arable land was spun off to find a buyer for it as Sunshine’s tea segment has been worrisome of late as with all tea businesses in the country facing mounting labour costs.
“Lotus Renewable Energy Group (LREG) bought control of Colombo Stock Exchange (CSE) listed Hatton Plantations (HPL) at Rs 1 billion on Tuesday. LREG will be making a mandatory offer for the remaining outstanding shares at Rs. 8.30 per share. LREG is part of G&G Group of Companies, Singapore with its operations across India, Singapore and Australia. It has over two decades of experience in managing several plantation estates in Sri Lanka. Hence we made sure our divestiture will be to an experienced business entity, and we are confident they will continue to develop the plantations as we have done,” Mr. Govindasamy said in his statement.
The group will continue to invest in its Watawala Tea, Zesa and Ran Kahata tea brands, he has said adding that the new owners of Hatton Plantation were already running similar businesses in Sri Lanka.
Earlier LREG, owned by the G&G Group in Singapore had 45 per cent in Pussellawa Plantations which they sold to a Damro entity two years ago. “We ideally wanted a controlling stake in a plantation company where we own the make decisions. So HPL with 55 per cent was a good fit,” Gowrie Shankar, Director G&G Group told the Business Times in a telephone interview on Thursday. He said that they own nine mini hydro plants with 9.15 MW (Mega Watts) total capacity here through Lotus Hydro Power PLC. “There are three more for a total 6 MW awaiting approvals,” he said.
While their main focus will be the tea business, he noted that hydro opportunities which Sunshine had earlier explored will be looked at.
He added that through G&G’s export arm in Singapore, LREG intends to export tea.