Kotagala divests tea exporting unit to related parties for Rs.1bn

Kotagala  Plantations PLC has divested the majority ownership in fully owned tea exporting subsidiary Union Commodities (Private) Limited for over Rs.1 billion to related parties, according to a filing at the Colombo Stock Exchange.

Under a financial restructuring plan, Kotagala Plantations sold a 70 percent stake in Union Commodities to its largest shareholder Consolidated Tea Plantations Limited for Rs. 850 million, and another 15 percent stake to Agarapatana Plantations Limited for Rs. 182 million.

Kotagala Plantations made a net loss of Rs. 61.3 million during the 3rd quarter of 2018, falling from a Rs. 11.4 million net loss year-on-year despite a 10 percent uptick in revenue, due to a fall in other income.

Colombo Fort Land & Building PLC, the ultimate parent, has majority ownership in Kotagala Plantations through the Lankem Group.