Citrus Leisure invests over Rs. 1.9 b in two resort projects

The Board of Directors of Citrus Leisure PLC announced over Rs.1.9 billion worth of investments to their newly-incorporated subsidiary companies Waskaduwa Beach Resort Limited and Kalpitiya Beach Resort Limited.

The announcement was made by letter to the Colombo Stock Exchange (CSE) yesterday. The Directors of Citrus Leisure Plc, formerly Reefcomber Plc stated that the company invested an amount of Rs. 880 million to subscribe for 88 million ordinary shares of Waskaduwa Beach Resort Limited, representing 62.85% of the issued shares.

Waskaduwa Beach Resort Limited has also concluded a private placement of 52 million shares at Rs.10 per share to raise funds to finance the construction of a hotel project in Waskaduwa.

“Citrus Leisure invested an amount of Rs. 1,046,500,000 to subscribe for 104,650,000 ordinary shares of Kalpitiya Beach Resort Limited representing 72.18% of the issued shares. Kalpitiya Beach Resort Limited has also concluded a private placement of 40,350,000 shares at Rs. 10 per share to raise funds to finance the construction of a hotel project in Kalpitiya,” the letter to the CSE said.

The company stressed that subsequent to the private placement of shares both Waskaduwa Beach Resort Limited and Kalpitiya Beach Resort Limited would apply to the CSE and to the Securities and Exchange Commission to list the shares of the respective companies.

 The Board of Citrus Leisure Plc include Chairman Prema Cooray — former Chairman Aitken Spence Plc, a veteran hotelier and Directors Suresh de Mel, MD – Lanka Fishing Flies Ltd.; N. Senarathne, MD – Yaathra Travels; Rajinda Seneviratne, MD – Corona Teas; Raynor Silva, MD – ABC Radio; Dilith Jayaweera, Jt. Managing Director – Triad; Varuni Fernando, Jt. Managing Director – Triad; Sarva Ameresekere, COO – Triad; and Manoj Pilimathalawe, Head of IT – Brandix.

The company formally took over the management of Amaya Reef on 1 January 2011 and has re-branded the resort Citrus Hikkaduwa. The property is over-booked up to mid-April 2011 and the management believes it is on track to surpass financial targets.

Plans are afoot for a five month refurbishment starting May 2011. The refurbishment is being undertaken on a strict strategy of cost versus benefit and is designed to double revenue by the end of the next financial year through increased room rates and better use of common facilities.