Overseas Reality acquires 60 per cent stake in Mireka Capital Land

ACQUISITION: Overseas Reality (Ceylon) Limited ('ORCL') owners and managing company of the World Trade Centre Colombo Fort, announced to the Colombo Stock Exchange ('CSE') on July 19 that it has entered into an agreement with the Shing Kwan Group the principal shareholder of ORCL, to acquire its 60% stake in Mireka Capital Land (Private) Limited ('Mireka') for a total consideration of Rs. 1.125 Billion.

Mireka commenced operations as a joint venture between Shing Kwan Investment (Singapore) Pte. Limited and the Bank of Ceylon to develop and manage the "Havelock City" project in the Colombo Metropolitan area.

Construction work on Havelock City is already under way. This mega-project will consist of eight blocks of condominium housing providing 1,080 apartments of varying sizes set in a landscaped environment.

The adjoining commercial component will include a 320 room hotel with additional 200 units of serviced apartments, a shopping centre with 250 shops and major department stores, a supermarket, food court and other facilities, all designed and built to international standards.

The project is to be built in phases with the final completion scheduled in 2010. The estimated gross development cost is approximately USD 250 Million. 'The acquisition of the 60% stake in Mireka will add to shareholder value for both existing and new investors in ORCL.

In addition, both Shing Kwan Investment (Singapore) Pte. Limited and Bank of Ceylon have each made a continuing commitment to provide working capital until the final completion of the residential component of the development.

Execution risk is, therefore, minimised without placing any financial burden on ORCL, a press release said.