Financial Times

Vallibel deal to be finalised in 3 weeks

Despite strong speculation in the stock market that Vallibel Power Erathna (Pvt) Ltd (VPE) has received a Rs. 800 million advance from its prospective American buyer to purchase the company, a VPE director rejected this claim.

"No we have not got an advance," Nimal Perera, Director VPE told The Sunday Times FT. The total price for the purchase will be roughly Rs. 4 billion at Rs. 5 a share.

At the VPE Annual General Meeting (AGM) held on Tuesday, Dhammika Perera Chairman VPE had said the deal is being finalised. "He said that in two to three weeks times the deal will be finalised," a shareholder who was present at the AGM told The Sunday Times FT. He said some shareholders had objected to the hydro-power company being sold, saying they had invested in it because, Mr. Dhammika Perera was in the management. "Then Mr. (Dhammika) Perera said that VPE, the 10 megawatt company has given more than 100 percent return to the shareholders continuously. He said Rs. 5 per share was a good price and that this price was agreed by the buyer when the oil price was at US$ 140," the shareholder said.

The hydro-power generating firms get their unit prices from the Ceylon Electricity Board based on the oil price prevailing at the time. VPE posted a profit of Rs.377 million for the year ended 31st March 2008 , which is a 147 % rise against its Rs.152.8 million profit last year

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