Reminiscences

DSJ: My most profound career influence

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Retired Hayleys PLC Deputy Group Chairman, United Motors PLC Chairman, Joint Business Forum Chairman, DFCC Bank Director and incumbent Non Executive Chairman of both Commercial Bank of Ceylon PLC and Pelwatte Sugar Industries PLC Mahendra Jayanthipal Chandima Amarasuriya reminisces

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Business leader Mahendra Amarasuriya believes that the late and iconic and visionary Hayleys Group Chairman Damitlal Senakumar Jayasundera was his most profound career influence.

“He was a visionary, albeit not having a tertiary academic/ professional background and I cannot think of a better Hayleys Group Chairman than him and he was also the best corporate sector Chairman during his life and times, Mahendra told Daily News Reminiscences at his Fife Road residence.

It is he who recruited me as a Management Trainee straight out of Colombo University and it was under him that I learnt about Management and the manner in which blue chip companies are run, he said.

Mahendra, a product of Royal College, Colombo where he won his Tennis Colours and also his Public Schools Tennis Colours, joined the Colombo University to read for a Botany Honours Degree with Chemistry as a subsidiary. He graduated in that. “I was vying for Honours but panicked in the examinations which also coincided with delayed examinations following a university strike sparked off at Peradeniya which cascaded to Colombo”, he mused.

After two months at the Deans Road Head office, he was posted to the subsidiary - Chas P Hayley which was also then Ceylon’s largest sheet rubber exporter. Hayleys at that time was largely a commodities exporter- tea to European markets, rubber to China and also essential oils to a multitude of global destinations, he reminisced.

Spreads wings

He was promoted Assistant Manager and General Manager in 1970 and seven years later as Director of the Hayleys Main Board in 1977. Right from the start, he reported directly to Chairman Jayasundera. Subsequently, Hayleys exited from the export of sheet rubber and spread its wings into other areas.

Then it was Haychem which was established and tying up with Germany’s Bayer for the import of Agrochemicals which was followed by a large number of imports of a diverse array of products such as industrial chemicals and pharmaceuticals. There was Dipped Products for the manufacture and export of rubber gloves, Hayleys Exports for exporting coir fibre in various forms and Haycarb for activated carbon, he said. He was by that time the Hayleys Main Board Director heading the Imports Division.

It was also at that time that John Keells Holdings, Aitken Spence and Hayleys were the largest corporate conglomerates in turnover and profits, he said.

However, he lamented that the export rich Hayleys conglomerate which accounts for 12% of Sri Lanka’s exports did not see the volume growth and the desired diversification vis a vis the JKH and Aitken Spence, which he attributed to poor vision and leadership.

Sharp contrast

They are merely carrying on with the existing lines of business in sharp contrast to JKH and Spence which steamrolled into new areas such as overseas hotels and property development to name a few, he said.

A further drawback he sees to the growth of the Group and especially profits is the huge borrowings which has trimmed profits due to debt financing.

However, when pointed out that the Hayleys Group has Groups within the main Group such as the Maritime Group, the Harcarb Group and the Dipped Products Group, he conceded that there were subsidiaries of Maritime, Haycarb and Dipped Products but added that they were not doing too marvelously well of late.

Maritime was probably the most successful but Haycarb performs well only on and off, he said.

He sees the establishment of the Hayleys Trust which holds the shares of the late Chairman D.S. Jayasundera being the drawback for the Group going in for Rights Issues. “The Trust did not want to invest in Rights Issues,” he said.

Right move

He also sees the Dhammika Perera acquisition of the controlling interests of the Group as a right move with the existing future potential. He acquired the company at the time the shares had dipped, but he would have seen the potential of the Group. We don’t know in which direction he will charter the course for Hayleys, Mahendra said.

He was promoted Deputy Chairman to Sunil Mendis with the resignation of Jayasundera who migrated to Australia. Sunil was slightly senior to me at Hayleys by around five years joining soon after Royal without the four years at University, he said.

Commercial Bank and United Motors

It was also in the 1990s that he was invited to the Board of Commercial Bank by then Chairman Sarath Kusum Wickremasinghe. He was promoted Deputy Chairman and promoted Chairman with Wickremasinghe resigning as Sri Lanka’s High Commissioner to UK.

Another landmark in his career was when he was appointed to the Board of United Motors Lanka PLC which was also the first state entity to be privatized, which President Ranasinghe Premadasa described as “peoplised”! President Premadasa hand picked the United Board with Karu Jayasuriya as the Chairman, Chandra Jayaratne as Finance Director, Eraj Wijesinha as Marketing Director and me possibly due to my Human Resources background, he said.

“United Motors was a brand leader with the Mitsubishi agency where the only real competition was from Associated Motorways PLC and Nissan. With Karu’s resignation in his quest for politics, I was appointed Chairman,” he said.

Commercial Bank was also performing well but the only real issue was the dealings in the oil hedging contracts.

Ambitious projects

Another one of the companies that he heads as Non-Executive Chairman is Pelwatte Sugar Industries PLC after its acquisition by magnate Ariyaseela Wickremanayake. The sugar company made profits for two years after redeeming its debt, but had a Rs. 700 million loss last year due to a parasite - Wooly Aphid which has not only eaten into the sugarcane but also into the profits.

He believes that the company will be able to break even this year but it will take another three or four years to recover the Rs. 700 million loss.

Pelawatte has two more ambitious projects. One is a milk production venture with Danish collaboration and the other is a six star hotel, Sri Lanka’s first, but abandoned temporarily due to the company being cash strapped.

His two-year tenure as the JBiZ Chairman was one of the toughest in Sri Lanka’s contemporary history. With Chandrika Kumaratunga as President and Ranil Wickremesinghe as Prime Minister, all private sector efforts to adopt a bipartisan approach and consensual politics had failed.