Financial Times

Ceylinco Finance and Asian Finance merger will help both firms

 

The merger of Ceylinco Finance PLC and Asian Finance Ltd will help combine the assets and strengths of both companies and which is useful for economies of scale where structural similarities such as lending, leasing, real estate and housing will be under one umbrella.

W.G.B.M. Ranaweera, Deputy Chairman, Ceylinco Finance PLC, at the press conference held to announce the merger last week in Colombo, said the merger would significantly add value to shareholders and provide a strong foundation for a consolidated operation. It will ensure common management focus, help achieve greater integration benefits and reduce overall administrative costs.

The combined asset of both finance companies was around Rs 8.3 billion and the merger is also targeted for the combined Ceylinco Finance to increase its rankings in the financial services market. The group’s net asset per share is around Rs 49.38 while the company’s net asset per share is Rs 27.87. The group achieved a net profit of Rs 15.49 million during the financial year 2007/2008.
The operating profit stood at Rs 17.6 million. The group has been able to maintain a moderate growth while recording a significant increase in its asset base by 7.9 percent over the previous year to stand at Rs 10.9 billion.

Mr Ranaweera said that this merger will establish Ceylinco Finance as a major player in the consumer finance market with significant asset addition also in the corporate finance segment. He said that the strong access to low cost funding that Asian Finance has coupled with the high growth-high margin retail financing business that Ceylinco Finance is involved in, will help in the process.


 
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