Financial Times

The Associated Motorways Group (AMW) which burst into the news last week with a strategic deal with John Keells Holdings, a few weeks after De Zoysa took majority control of the company, has some mega diversification plans ahead to steer growth.

It is gearing for more investments with a Maruti assembling plant here and a marina service centre in Bentota with the landmark property development alliance with JKH set to venture out into real estate and apartment buildings.

"We are having discussions with Maruti in India to assemble Maruti cars in Sri Lanka," Ajith de Zoysa, Chairman, AMW told The Sunday Times FT in an interview. He said that presently nothing is concrete as yet but talks are progressing positively.

He said the company had bought land in Bentota to put up a marina service centre to repair and attend to sports marine equipment. "We will be investing Rs.70 million on the marina service centre," he said, adding that this business will 'definitely' develop with more tourists coming into the country.

"There will be peace for sure and as soon as peace comes, tourists will start coming in. We invested in this land to get a head start," De Zoysa said, adding that jet skis, water skis and other such water sport equipment will be serviced at the proposed service centre.

Speaking more on the need for peace, he said that peace is a must and sooner or later both sides will realise this fact. However, he added that the present situation is not a deterrent for business. "We got into the recent alliance with JKH in the prevailing situation and business must go on," he added.

He said that in the future the 60-year company would be looking at any type of diversification. "We want to complete the upmarket apartment complex and building of nearly 10 floors at D.S. Senanayake Mawatha, where we will be shifting, which will take nearly three and a half years. After this investment, we will consider any diversification - even agriculture," he said.

De Zoysa said that a day after Richard Peiris Group (RPG) resold the 21 percent stake of AMW -- bought from Shankar Somasundaram, owner of S.S. Motors at Rs. 430 million -- back to AMW, JKH Chairman, Susantha Ratnayake had approached him with the property development idea. "And it made sense," he said The two companies entered into a "Voluntary Partial Offer" where the JKH will take up a 20 percent stake in AMW in a two tier strategy to develop the land at Union Place and the adjoining properties of the JKH at Vauxhall Street recently.

De Zoysa said that after this deal has been approved by the shareholders, the two companies will decide on the name for the new property development company.

He said AMW has grown above industry standards last year. "Maruti and Suzuki have made a good contribution to the profits," he added.