Citrus Leisure to raise Rs.1.5bn

Citrus Leisure PLC announced this week that it would raise Rs.1.5 billion by way of a rights issue. 
In a filing to the Colombo Stock Exchange, Citrus Leisure PLC said it would offer 378,354,954 ordinary shares, at Rs.4.20 per share.  

As per the filing, 143 new ordinary shares will be issued for every 101 existing ordinary shares held by the shareholders. 

The current stated capital of the company is Rs.3,256,172,662, represented by 267,229,723 ordinary shares. 
The proceeds of the issue will be utilised to settle the outstanding related party loans of the company borrowed from George Steuart and Company Limited, amounting to Rs.1,253,230,305, which is in line with the entitlement of related party shareholders under the rights issue. 

It will facilitate the full subscription of the company’s entitlement in the rights issue of Hikkaduwa Beach Resort PLC (CITH), amounting to Rs.181,200,674. 

The proceeds will also be used to subscribe to any additional shares required to raise the full amount under the rights issue of CITH, up to a maximum of Rs.154,659,829. 

Further, Citrus Leisure said it wants to retire non-related party loans of the fully-owned subsidiary of the company, Citrus Silver Ltd, to the maximum extent possible, if in the event of any funds raised via the rights issue remaining with the company, post subscribing to the rights issue of CITH, up to a maximum of Rs.154,659,829.  However, the board at its discretion would reserve the right to decide on the final bank loans to be settled at the company/subsidiary level, depending on the requirements of the lending institutions, the company said in the stock market filing. 

The non-related party loans of Citrus Silver Ltd primarily identified for settlement are two bank loans amounting to Rs.114,000,000 and Rs.40,000,000.