State companies soon on the CSE
Two new state-controlled companies are to be floated shortly and listed in the Colombo Stock Exchange (CSE) for the purpose of attracting investments.
The two companies will be listed on the stock market to harness the maximum advantage of the present boom in the stock market with high investor interest, officials said
The two new entities Selendiva Investments Ltd for hospitality and real estate sectors and a Special Investment Company called SIFCO almost exclusively for the highway sector are to be incorporated under the purview of the Finance Ministry.
Selendiva Investments Ltd with Treasury ownership of 51 per cent, public 15 per cent and institutional investors 34 per cent of shares will take over the management control of Hilton Colombo, Grand Hyatt Colombo, Grand Oriental Hotel Colombo, Lotus Tower and unutilised land in Colombo.
Officials said that the Government was pursuing a strategic plan of establishing state-owned companies initially to manage underperforming and underutilised hospitality ventures and already built expressways or expressways/ highways which are under construction.
These state‐owned real estate or infrastructure sector based holding companies (SOHCs) will enable such ventures to attract investment and boost investor confidence, a Finance Ministry memorandum revealed.
It is aimed at helping the authorities meet their targets setting the foundations for future private sector participation in the relevant sectors, with public-private partnerships (PPPs), a senior official of the ministry said.
It will also play an increasingly important role in government’s production-oriented strategy facilitated by structural changes within the framework of a market economy.
The Government’s intention is to revitalise those entities in the hospitality and real estate sector via PPPs with better management but not to privatise them, he emphasised.
Rural connectivity is poised to improve significantly, with the government securing funding from the Asian Development Bank (ADB) to rehabilitate rural roads.
These road renovations form part of a high cost infrastructure development plan that will also include the construction of several rural expressways in the coming years.
Although budgetary shortfalls could make it difficult for the government to allocate the necessary funding for all of the planned developments, the formation of SIFCO will help solve the financial requirements.
Opposition MPs have questioned the government as to whether 49 per cent of this new state owned Special Investment Company aimed to finance and manage the country’s expressways would be handed over to a Singapore based firm.
| CSE indices up | |
| The ASPI (index) of the Colombo Stock Exchange ended at a record 8,463 on Friday while the S&P was up at 3,312. Trading volumes was at a record 590 million shares while turnover was Rs. 12.8 billion.
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