Richard Pieris to exit Maskeliya

Chairman says target is US$ 40 million:

Ravi LADDUWAHETTY

Diversified blue chip Richard Pieris and Co PLC will shortly exit from Maskeliya Plantations PLC which Group Chairman Dr Sena Yaddehige describes as “will be at the right price.”

“We were never interested in exiting from Maskeliya Plantations as it was one of the key profit centres of the Group. However, there are three parties which are very keen to buy it for some reason and the deal is under negotiation.

We are talking and we will get rid of it if we get over US$ 40 million, RPC Group Chairman Dr. Sena Yaddehige told Daily News Business yesterday.

He said he personally does not want to exit from Maskeliya Plantations but the offers and the proposals from the prospective buyers were so attractive that the Group will exit the plantations subsidiary if offers are over US$ 40 million.

He also refuted fuelling market speculation that he was to divest the entire Group and return to his business houses in England.

However, he conceded that the Group was restructuring loss making subsidiaries in the wake of a staggering Rs. 1.5 billion interest costs plaguing the Group.

“This is the reason why we exit from the media business of the Group - the Rivira Media Corporation and we have also stopped operations of Arpico Real Estate, though we have not sold it yet,” he said

The RPC Group also further hopes to restructure the furniture manufacturing subsidiaries Hamefa Kegalle Ltd and Timberline Ltd the former which manufactures furniture and which had a joint venture with of Netherlands but that arrangement is no more, according to Dr. Yaddehige.

He said that the loss making subsidiaries were under constant scrutiny for restructuring for profitability.

“We had had discussions with potential joint venture partners to evaluate operations and forge alliances to develop the furniture business of the Group, he explained.

The financial performance of Maskeliya Plantations for 2007/2008 has been impressive. The turnover has increased to Rs. 2.5 billion, up to 0.6 billion from the Rs. 1.9 billion the previous year.

Post tax profits have also increased phenomenally by 390 per cent between the two years to Rs. 55.6 million from the Rs. 11.3 million.

Meanwhile Dr. Yaddehige in his 2007/2008 annual report to Maskeliya Plantations PLC shareholders has said that it was disappointing that the pure gains for the top end high grown teas such as those of Maskeliya and Dimbula were not proportionate to the teas at the lower end.