Lotus Renewable Energy acquires Hatton Plantations

Lotus Renewable Energy (Private) Limited (LREL) yesterday bought the controlling stake of Hatton Plantations PLC (HPL) for a consideration of Rs.1 billion.
LREL, by way of a crossing, acquired 120.7 million shares or 51 percent stake of HPL from its major shareholder, Estate Management Services (Private) Limited (EMSL), at a price of Rs.8.30 per share.

As at December 31, 2018, HPL’s book value was Rs.8.25 and as at same date EMSL, which is jointly owned by Sunshine Holdings PLC (60 percent) and Pyramid Wilmar Plantations (Private) Limited (40 percent), held 75.65 percent of HPL.

LREL in a stock market filing said following the acquisition of controlling stake in HPL, they will be announcing a mandatory offer at Rs.8.30 per share to the remaining shareholder of HPL in terms of the Company Takeovers and Mergers Code to acquire the ordinary shares held by them.

The filing also said EMSL has given an undertaking to LREL that they would not accept the mandatory offer in the event LREL failed to acquire at least 75.65 percent of the issued shares subsequent to the mandatory offer.

Sunshine Holdings PLC in a separate filing said LREL has also granted EMSL the right and entitlement to sell all or part of the balance 58.3 million shares held by EMSL to them at any time within a period of three months from the expiry of the mandatory offer at a price of Rs.8.30 per share. 

LREL is part of a Singapore-based energy group located in Wattala, which made inroads to Sri Lanka’s hydro power sector through the acquisition of Browns Hydro Power in July 2016. The company subsequently changed the name to Lotus Hydro Power PLC.

The directors sit on LREL board are: Chairman/ Executive Director Gary Seaton, Executive Director A.U.A.M Athukorala, Non-Executive Directors K.Gowri Shankar, Dr.T.Senthilverl and U.H. Palihakkara and Independent Non-Executive Director W.M.A. Indrajith Fernando.  

“Sunshine Holdings’ divestiture of majority control of Hatton Plantations PLC, to Lotus Renewable Energy (Pvt) Ltd, is in line with the group’s strategy of taking a significant step in refocusing our footprint in healthcare and consumer segments for strategic specialization, especially in the branded tea segment,” Sunshine Holdings Managing Director Vish Govindasamy said. 

A Sunshine Holdings statement released to the press also said Lotus Renewable Energy Group, a multinational renewable energy company with its operations across India, Singapore and Australia, has over two decades of experience in managing several plantation estates in Sri Lanka.

NDB Investment Bank (NDBIB) acted as the sole transaction advisor for the deal.