EPF buys shares of Vallibel One to the tune of Rs.200 million?

From the news coming out of latest private placement of Vallibel One which offered 160 million shares at Rs.25 on January 17, sources from Colombo Stock Exchange says that island nation’s largest pension fund Employees Provident Fund (EPF) had recently applied for shares of Vallibel One for the tune of approximately Rs.200 million.

Island nation’s economic twist booster and financial planner who is preparing the ‘Miracle of Asia- Sri Lanka’ to face firmly for ‘Future Shocks’, Central Banker Ajith Nivard Cabraal leaded board manages Sri Lanka’s workers savings fund, EPF which has moneys exceeding Rs.855 billion according to reports. EPF had recently increased its stakes in country's private banks and hotels such as HNB, Galadari and Insurance companies.

Meanwhile sources close to Vallibel One issue told CSE Leaks that the private placement had already been oversubscribed and that it will come with the IPO on March 2011.

Vallibel One Limited is a diversified holding company incorporated on 09th June 2010. Prior to the proposed private placement and initial public offering, 100% of the shares in issue are held by the business tycoon Dhammika Perera and companies controlled by him.

Through its subsidiary companies Vallibel One has made strategic investments in financial services, manufacturing and leisure industry.

Vallibel One has 51% stake of LB Finance (LFIN) PLC and strategic investment of 15% in Sampath Bank PLC (SAMP) with another 51% stake of Royal Ceramic PLC (RCL).

Company is raising funds to finance an equity investment of Rs.3 billion in a new hotel project developed under its full owned subsidiary Greener Water Limited. The hotel will target the high end of the tourist segment and will be positioned as a five star hotel. At commencement, gross Average Room Rate will be US $ 180 and will increase up to US $ 220 by the 5th year of operation.

Greener Water Ltd has already invested Rs.266.73 million in a 14 acre land located in Kochichikade, Negombo, Sri Lanka. The company intends to build a 382 room, luxurious five star hotel designed by WATG of Singapore, one of the world’s leading design consultants for the hospitality, leisure and entertainment industry. The construction of the hotel is estimated to take two years and commercial operations are planned to commence by end of 2013.

The total estimated cost of the hotel project is Rs.5 billion and the hotel will be developed as a BOI approved investment which will qualify for 8 years tax holiday, and a concessionary tax rate of 15% thereafter.