The Government, close to a possible deal with Shell Gas Lanka’s (Shell) parent, Royal Dutch Shell to buy its 51% which will see them complete owners of the entity, will subsequently sell 49% of Shell through the Colombo Stock Exchange to a local firm to manage and retain 51% control, according to informed parties.
“The Government has done a due diligence and given an offer (along these lines). This will be done if the deal to buy back 51% from Royal Dutch goes through,” W.K.H. Wegapitiya, Chairman Laugfs Holdings Ltd. told the Business Times. The Government now has a 49% stake in Shell. Laugfs has also expressed interest in buying up Shell’s 51%.
Mr. Wegapitiya said the government seems to be close to striking such a deal and they’re aware that it’s difficult to run such a firm profitably on their own. “Historically the government has failed to manage such entities and it’s easier for firms such as (Laugfs) to compete with them (if they decide to manage it on their own)”, he said.