Ceylon Hotels Corporation (CHC) yesterday announced it has received the green light to fully acquire Ceylon Hotel Maldives (CHM) through its fully owned subsidiary United Hotels Company (UHCL).

The acquisition of the entire shareholding was approved for a sum of Rs.700, 020.

In a filing to the Colombo Stock Exchange (CSE) yesterday, CHC stated it has obtained Exchange Control approval for an equity investment of $ 11.08 million to be pumped into the construction of a resort in Maldives.

The 50 room resort for which CHML will be the developer and operator, will be constructed with a total cost of US $ 27.70 million, whereas the balance US $ 16. 62 million will be funded through a bank borrowing.

Furthermore, the board of CHC has approved a private placement of Rs.500 million into UHCL by Ceylon Hotel Investment (CHL), based on the independent valuation done by the NDB Investment Bank.

After the private placement, CHC will be holding 78.40 percent of UHCL. Ceylon Hotel Holdings Limited, the parent company of CHC owns 50 percent of CHI. (SAA)