The Brown group’s Eden Hotel Lanka PLC will be opting for a rights issue of Rs.1.06 billion to repay part of its outstanding debts.

To this end, 52.8 million shares will be issued in the proportion of one new share for one existing share at Rs.20 per share.

At yesterday’s trading, the Eden share closed at Rs.22.50, up 10 cents.

Eden Hotel completed a major refurbishment covering the rooms and key areas in the hotel and also acquired Dickwella Resorts (Pvt.) Limited in the previous financial year.

According to the June interim financial accounts, the stated capital of Eden Hotel was Rs.528 million, while having reserves of Rs.1.61 billion, which remained stable from March, and retained earnings of Rs.69.39 million, which fell from Rs.182.21 million.

It has long-term interest-bearing borrowings of Rs.1.2 billion, which fell from Rs.1.4 billion, and short-term interest-bearing borrowings of Rs.968.14 million, which increased from Rs.934.35 million in March.

The hotel firm’s total asset base was Rs.4.88 billion, falling from Rs.5.04 billion in the same period.

It sustained net losses of Rs.111.46 million for the quarter ended June compared to a net loss of Rs.124.32 million year-on-year.

The main contributors to the loss were other operating expenses and finance costs.

The Brown group’s Palm Garden Hotels PLC owns 46.21 percent of the shares in Eden while Confifi Management Services (Pvt.) Ltd owns 10.70 percent
The state-owned Employees’ Provident Fund owns 9.98 percent.