Right of Reply: LTL Holdings responds to COPE findings

LTL Holdings Ltd., (LTLH) has issued the following Right of Reply to the Daily FT article titled “COPE uncovers major ownership dilution and audit concerns at LTL Holdings linked to CEB” published on 21 October, citing several inaccuracies.

LTL Holdings Ltd., and subsidiaries were invited “to be present on 24 October 2025 for the purpose of questioning in respect of the examination of the Ceylon Electricity Board (CEB).” So, they were under the impression that the company would be questioned with regard to CEB related matters. Letter of invitation did not mention any area of questioning or concerns and in fact, we were not aware of the specific questions that were going to be raised. But to our surprise, right from the beginning, questioning was only about affairs of LTLH.

The reason for LTLH not being audited is not due to any avoidance or denial of access. As per the National Audit Act and/or the Constitution, LTLH is not an “auditee entity” for it to be audited by the Auditor General. However, LTLH and all its subsidiaries have been audited by the auditors appointed by its shareholders, which includes the CEB, not once but twice every year over the last 40 years. They have been incorporated into financial statements of the CEB as required. As the Auditor of the CEB, the Auditor General has the right to inquire on any matter related to LTL’s audited financials from LTL or LTL’s auditor. Whenever they inquire about any concerns through the CEB, LTL has duly submitted their responses and facilitated the CEB audits to date. The LTL Holdings group, with its local and international operational arms, has complied the required auditing and compliance aspects duly and timely in line with laws and rules applicable to the relevant jurisdictions.

With regard to the creation of 10% Employee Trust, we have to emphasise that it was a decision of the two shareholders i.e., the CEB and ABB of Norway, and not of the employees. It was later converted to a company called Teckpro Investments Ltd., to solve a regulatory issue faced by LTL’s foreign operations. CEB employees were not entitled to its shares nor did any CEB employees receive any shares or dividends. 

The decision of the CEB to transfer part of its shares in LTLH to West Coast Power Ltd., was a part of the CEB’s debt restructuring program, which was initiated under a policy decision of the Government. LTLH did not play any role in that transaction beyond registering the new shareholder on the instructions of the CEB. At that point, the CEB’s shareholding was reduced to 35% from 63%. However, West Coast Power Ltd., also is a company in which the majority shareholding is controlled by the Government. 

All these three shareholder composition changes of LTLH in its history have taken place merely due to external party offers and events and none of them were initiated by LTLH in any of the instances. 

The current CEO of LTLH resigned from the CEB and joined LTLH on 1 January 1997. He never held any shares of any LTL companies before joining LTLH and did subscribe to one share of LTLH’s subsidiary named Lakdhanavi Ltd., in the year 2000. Thus, there was no conflict of interest at any point of time. He did not remember the exact dates of these events when questioned by the Committee on Public Enterprises (COPE), which led the discussion that was referred to in the article. 

All power plants, including renewable ones, are added in line with the 20-year Long-Term Generation Expansion Plan (LTGEP) prepared every two years by the CEB and approved by the Public Utilities Commission of Sri Lanka (PUCSL) after public consultation. Our subsidiary, Lakdhanavi, has taken part in competitive bidding tenders for the power plants identified in the LTGEP and won projects by always offering the lowest price. We have not obtained any project outside the LTGEP.