Financial Times

New ASCOT owners to build apartments on Templers road site
The new owners of Asian Cotton Mills (ASCOT) are preparing to restructure the factory and develop part of its site in the eight-acre land at Mount Lavinia.

"Presently, the two Malaysian and three local investors, who have formed Axis Financial Services (AFS), which bought the controlling stake of 51 percent are evaluating many options, but they are very interested in reinvesting in machinery for the factory and developing part of the land," a senior official at Axis Financial Services (AFS) told The Sunday Times FT.

AFS is owned by Boston Capital, a bond trading company headed by Rohan Iriyagolle, which bought the troubled yarn firm from Kuwaiti Al - Nakib family. ASCOT has loans, some of which are from the government at no interest. "The land is totally undervalued and it is a very valuable asset, despite ASCOT's loans," the AFS officer said, adding that the owners are seriously looking at putting up apartments in part of the land, as it is in a highly residential area at Templers Road.

Real estate brokers said a perch in the area costs about Rs. 450,000. The AFS officer said that one of the Malaysian investors, who has a garment factory in Malaysia is keen to reinvest in the machinery at the factory and start operations to export yarn to Malaysia, for his business.

"Right now the owners are number crunching on the factory and the land, while getting ready for the mandatory offer due next week," he said. He said depending on the result of the mandatory offer, the company will decide on buying the balance shares.

Stock market analysts said that the ASCOT factory, on a replacement value is worth US$ 6 million and an infusion of Rs. 80 million is required to revive the company. Thalib Al Nakib, a retired Kuwait businessman, told The Sunday Times FT, when he acquired the company last year, that it is a 'viable' investment and has a lot of potential.

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