Richard Pieris to buy 51% of Chilaw Finance

Tuesday, 9 September 2014 01:47 -     - {{hitsCtrl.values.hits}}

Richard Pieris Group is to buy 51% control of Chilaw Finance PLC, via subsidiary Richard Pieris Arpico Finance Ltd., as part of the Central Bank-initiated financial sector consolidation. RPC said the subsidiary has entered into a Memorandum of Understanding with major shareholders of Chilaw Finance. The firm is conducting a legal and financial due diligence as per the MoU and the purchase will be finalised after the due diligence. On 13 August, RPC subsidiary bought 12.5% stake in Chillaw Finance for over Rs. 100 million via the stock market. Price paid was around Rs. 25.50 per share. Its Net Asset Per share is Rs. 15.43. Chilaw Finance is a relatively small finance company with assets worth Rs. 1.3 billion and liabilities of Rs. 796 million. Its directors including J.A.D.N. Jayasuriya and related parties collectively own a 27.6% stake in the company. The other largest shareholder is R.W. Kulatunga – owning 11%. Chilaw Finance has 61% in public share holding. Richard Pieris Arpico Finance recently reached the milestone of Rs. 1 billion in deposits and said it is planning at least five branches within the next four to five months with the first one in Matara.