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LOLC, partners buy PMB

People’s Merchant Bank Ltd (PMB) is anticipating a change in the Board of Directors and a new management strategy, which is yet to be announced.

This is following the purchase of its stakes by a few companies at the Colombo Stock Exchange, its sources said.

Under this deal, Lanka Orix Leasing Company Ltd (LOLC), the US based Galleon International Master Fund (GIM), Lionhart Investments Ltd and Hongkong based South Bridge Investment (Sri Lanka) Limited (SBIL) became shareholders of PMB with their recent purchase of shares.

With this new development the share value of the company doubled at the Colombo Stock Exchange.

PMB shares which traded at Rs 30 a share went up to Rs 80 following the deal, a top LOLC official told the Daily News.

LOLC, the pioneering leasing company in the country, acquired a 19.93% (4,982,953 shares), GIM, a member of the US based Galleon Group, acquired a 12.74% (3,183,900 shares) and SBIL acquired (7.5 per cent) stake in PMB.

Most of the shareholders are expecting SBIL to support the new shareholders to form the new Board of Directors and their strategies.

Today LOLC is a complete financial solution provider with subsidiaries engaged in businesses of factoring, finance company operations, stock brokering, insurance brokering, information technology, and infrastructure development.

The market capitalisation of LOLC is over Rs 6.2 billion. During the financial Year 2007, LOLC reported a consolidated turnover of Rs 3.9 billion and a net profit after tax of Rs 1.05 billion.

People’s Bank is the major shareholder of PMB with 39.20 percent of ordinary shares. During Financial Year 2006/07, PMB reported Net profits after tax of Rs 44.78 million.

The Galleon Group is one of the leading hedge fund management firms in the world with funds under management of over US $ 7 billion.

The Galleon Group specialises in managing long and short term equity strategies across major growth sectors and has been actively investing in Asia for over a decade.

The founder and Managing Partner of the Galleon Group is Sri Lankan born fund manager Raj Rajaratnam.

Prior to founding Galleon Group, Rajaratnam was President and Chief Operating Officer of Needham and Company, an investment bank focused on emerging growth companies. Lionhart Investments Ltd has already acquired 75 per cent of Walker and Greig Ltd recently.

LOLC pioneered leasing industry in Sri Lanka and commenced business in 1980. Today, LOLC is a household name and the growth and success of the company is mainly a result of the innovative business model, which capitalizes on growth opportunities.

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