SMB-Kenanga takes off in pursuit of foreign investment

JOINT VENTURE:A new Sri Lanka - Malaysia joint venture financial services powerhouse formally launched in Colombo last week, will actively promote foreign investment in key sectors and bring in to the country the expertise to offer innovative new capital market products and investment banking services.

The new company, SMB-Kenanga Investment Corporation Ltd., co-owned by Sri Lanka’s Seylan Merchant Bank (SMB) and K & N Kenanga Holdings Berhad of Malaysia, is well positioned to tap into the latter’s network spanning Malaysia, Singapore, Indonesia, Thailand, the Philippines, the UAE and Saudi Arabia to promote investments into Sri Lanka, the new venture’s promoters told a gala launch event in Colombo.

Identifying a key strength as its ‘reach’ to a wider network of foreign investors, the company said it also has the ability to introduce and advise on new financial products and structures to Sri Lanka with a team of experts comprising Sri Lankan and Malaysian investment bankers. Malaysia is currently the largest investor in Sri Lanka.

Strategically directed to make use of opportunities presented by the new corporate legal framework and by the Capital Market Master Plan of SEC and CSE, the new company intends to focus on public and private sector infrastructure development projects including property development, mixed developments, roadways and health sector related projects involving foreign investments;

explore the potential for more corporate finance advisory assignments such as buybacks and restructuring under the new companies act; and play a role in the facilitation of the derivatives market under the capital market master plan of SEC and CSE.

This is in addition to more standard services such as floatation of IPOs and private placements, fund raising via issuance of securities, take-overs, mergers and restructuring, structuring, managing and placing of securitisation transactions, structuring and managing employee share schemes, creation and issuance of investment products and secondary market placements of securities.

Bringing to Sri Lanka’s capital market the expertise and experience of one of Malaysia’s largest and most respected corporate finance and investment banking conglomerates, SMB-Kenanga Investment Corporation also seeks to place Sri Lankan issues overseas.

The new company was incorporated in November 2006 with an authorised capital of Rs 1 billion and an issued share capital of Rs 100 million with a 55 per cent contribution by Seylan Merchant Bank Group and 45 per cent by K&N Kenanga Holdings Berhad.

Ceylinco Consolidated Chairman Dr. Lalith Kotelawala described the advent of the new company as a potential milestone in the evolution and growth of Sri Lanka’s capital market, and a momentous event in the history of the Ceylinco Group, Sri Lanka’s leading financial services conglomerate.