Asian Cotton Mills planning to develop and divest

Asian Cotton Mills is looking at developing part of its property at Mount Lavinia, whilst planning to divest a part of it, according to its chairman, Vijaya Malalasekera.

In the company’s annual report, Malalasekera said the company had concluded the restructuring of the business, which commenced in October 2004. “In July this year, after making numerous representations to the government it was agreed that relief would be granted to all Textile Debt Recovery Fund loan recipients. Consequently all mortgages held over company assets have been released,” he said, adding that the company was set to redeploy assets such that reasonable returns could be generated over the long term.

The new board appointed a subcommittee which recommended the company look to developing part of the company’s land on its own whilst also looking to divest. He said a final decision in this regards would be reached pending the outcome of negotiations. He further said that after the divestment of land, the company will consider using the proceeds to make strategic investments in high growth areas of the Sri Lanka economy. “In order to do this the board decided to recruit a new team of professionals to manage these down stream projects. Whilst we continue to incur certain overhead costs, I am confident that we are laying a strong foundation to deliver a sustainable return over the long term,” Malalasekera said.