Reminiscences
Thoughts of a pioneering ceramics industrialist
Founder Chairman of Royal Ceramics PLC, Lanka Tiles PLC and retired
Chairman of Ceylon Ceramics Corporation and Lanka Walltiles PLC Felix
Premachandra De Alwis reminisces.
Ravi Ladduwahetty
The entry
and continuity of founder Chairman of Royal Ceramics, Lanka
Tiles and retired Chairman of Ceylon Ceramics Corporation
and Lanka Walltiles PLC Felix Premachandra De Alwis in the
ceramic industry, by itself, was a fairy tale. |
Well settled as Lankem Ceylon Ltd Managing Director and Director/
Country Representative in Sri Lanka and Maldives of Shell Company of
Ceylon Ltd from 1975 onwards, De Alwis (Chandra to family and friends)
was invited by President J.R. Jayewardene as Ceylon Ceramics Corporation
Chairman in 1977.
Chairman designate John Sebastian was hospitalised with kidney
ailments. Multinational Shell then had 49% equity in Lankem, and Chandra
had to take Shell permission to work part time and voluntarily as Ceylon
Ceramics Corporation Chairman to assist the Government.
As Chairman, he found the Japanese were dominating the ceramics
business with the Lanka Walltiles Balangoda factory detrimental to Sri
Lanka’s interest. The Japanese had manoeuvred the LWL Agreement in such
a manner where they not only had the access to all good products with
rejects fed into the local market, but the buying price fixed for five
years, was lesser than production costs.
The Japanese were showing back to back Letters of Credit showing low
prices and they were making the money fraudulently, De Alwis told Daily
News Reminiscences at his Nawala residence.
Piqued by the injustice, Chandra told the Japanese that Sri Lanka had
to take over the exports. The Japanese disagreed. They wanted to
withdraw from Sri Lanka and their shares bought by locals.
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De Alwis
watering plants at his Nawala home. Picture by Saliya
Rupasinghe |
“The Corporation loans and interest was a staggering Rs. 90 million.
We reduced by negotiations to Rs. 45 million. They agreed to take Rs. 20
million and the further Rs. 25 million on bank guarantees”, he recalled.
Lanka Walltiles PLC (in which the Ceramics Corporation had controlling
shares and with Chandra as the Chairman in the post 1977 period ) was
producing merely 3.5 million and 4 million tiles monthly and with
employees drawing a measly Rs. 400 at the time. Chandra introduced a
Production Bonus and the output rose to 9 million tiles. Worker
emoluments were more than doubled!
Chandra was on another ambitious project. Lanka Walltiles Ltd
manufactured only walltiles and there was scope for exporting clay floor
tiles.
Thus, the birth of Lanka Tiles PLC. The factory was launched at
Kiriwaththuduwa.
By that time, he had left Ceylon Ceramics Corporation following a
disagreement with then Industries Minister Denzil Fernando, who
succeeded Cyril Mathew. Denzil had blamed Chandra for expanding into
more factories without declaring dividends.
Chandra visibly annoyed with this callous remark, told Denzil: “As
far as I know, the UNP policy is to expand industries and exports and
earn more foreign exchange. I didn’t know that your policies were
different from those of the UNP! A heated argument ensued with Chandra
plucking the outright gumption and audacity to look at the Minister in
his eye, and bawl: “ I am resigning immediately. You can find someone
else to run this place. You do not have the commercial knowledge even to
run a tea boutique!!” Chandra resigned. The background was his fierce
independence and commitment and not succumbing to Ministerial dictates.
Coming events cast their shadows. Having more time after the
resignation as Ceramics Corporation Chairman and returning to Lankem, he
was not left alone. A Ratnapura gem businessmen A. M. Weerasinghe
(current Royal Ceramics Chairman) approached him claiming that he had
Rs. 25 million to invest in his district providing employment.
This resulted in another Chandra brainchild. Lanka Tiles was
manufacturing clay tiles and he saw the scope for the expansion into
manufacturing porcelain tiles. That saw the birth of Royal Ceramics. The
factory was constructed at Eheliyagoda, close to Weerasinghe’s home town
bastion. “This was the second phase of Lanka Tiles and Weerasinghe’s
capital of Rs. 25 million was woefully inadequate with the required
investment being Rs. 200 million,” he reminisced.
Share capital for Royal Ceramics was next. Chandra had to use his
plethora of corporate contacts who insisted that he should agree to be
Chairman A lesser known fact about Chandra is that he pioneered the
Employment Share Ownership Plan in corporate organisations. When Shell
wanted to exit Lankem and Sri Lanka, Chandra wanted Shell to sell the
49% shares to the Lankem employees worth only Rs. 2 million but Shell
refused.
He said that the Shell global policy was to distribute/ divest shares
proportionately to existing shareholders.
He also heaped praise on investor and BoI Chairman Dhammika Perera
who acquired the controlling interests at Royal Ceramics. He said that
it was timely in the wake of hostile takeover bids. Dhammika is quick on
the uptake and is managing well, he said.
Chandra at the ripe old age of 86, is yet a Director of Royal
Ceramics, being one of the larger shareholders. He is currently also a
Director/ Consultant to some Delmege Forsyth Group subsidiaries.
Chandra will also be remembered for his personal intervention in
thwarting the nationalisation of Lankem by the Sirimavo Bandaranaike
Government. When he heard of covert moves, he told Industries and
Scientific Minister T.B. Subasinghe that Lankem managed to sell 150
drums of a weedicide that the Petroleum Corporation could not sell and
that the Shell involvement was a mere Rs. 2 million. Subasinghe listened
intently and sanity prevailed.
Chandra’s first employment was in the public sector and in transport.
A fierce advocate of nationalisation based on the belief that the
private sector could not run buses without state intervention; he had
his opportunity with the advent of the 1956 Government of S.W.R.D.
Bandaranaike whose Transport Minister was Maithripala Senanayake.
B. R. Devarajan was CTB’s Chief Operations Manager. Chandra was
invited as Assistant Operations Manager. He was to later tell subsequent
Transport Minister V.A. Sugathadasa that the CTB would be profitable
with minimum fares increased from 5 cents to 10 cents! “What, do you
want us to lose the elections?!!” Sugathadasa rebutted.
Communal riots in 1958 saw 10 Bambalapitiya bound buses full of
refugees at the Ratmalana depot with drivers refusing to operate. The
Army was called to intervene. Colonel (and Sri Lanka Cricket legend)
F.C. De Saram told Chandra that he will shoot the recalcitrant bus
drivers! Chandra intervened. He told the drivers: “You wanted transport
nationalised.
You all benefit while I don’t benefit. If you cannot drive, I will
drive the first bus. You follow.” The embarrassed drivers obliged.
Chandra told De Saram that the issue was sorted.
Placed for a year as Manager of the now defunct Times of Ceylon, he
quit due to malpractices there.
A car clutch plate was replaced a record three times in a single
year! Then, Chairman of both Times of Ceylon and Mackwoods Ltd N.S.O.
Mendis invited him to be Mackwoods Company Secretary. Bored with little
work, where he was mostly reading newspapers, he joined Lankem as
Administration Manager in 1970, a demotion. His suave skills had him
promoted as Managing Director in five years.
An alumni of Richmond College Galle, S. Thomas’ College, Mt Lavinia
and St, Joseph’s College, Colombo, the last of which he was a First XI
Cricketer and leg spinner in 1942 under subsequent Sri Lanka cricketer
Fairlie Dalpathado, the Joes took on the Combined Colleges XI, led by
Thomian and subsequent Sri Lanka skipper V.G. ( Vernon) Prins. The
Combined Colleges XI was bundled out for 35 runs! The Joes got over 200.
When the follow on was about the start, chief guest- then Commander
in Chief of British Forces in Sri Lanka Sir Geoffrey Leighton arrived
and the match was adjourned for cakes and tea.
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