Four SOEs in discussion with CSE to go public
At least four state-owned enterprises will go public shortly, a top state official said. Approximately four state-owned enterprises (SOEs) are scheduled to go public on the Colombo Stock Exchange (CSE) this year, Trade Minister Wasantha Samarasinghe told The Sunday Times Business. Among these, entities in the manufacturing sector, trading, and others will go public, he said.
The government is poised for significant structural changes in state enterprises, moving away from traditional perspectives, Mr. Samarasinghe said, echoing what his president, Anura Kumar Dissanayaka, said earlier this year. Mr. Dissanayake highlighted the potential for merging loss-making state entities, entities and exploring the issuance of shares on the stock market through a holding company. This initiative is part of a broader strategy to reassess the roles of corporations and boards within these enterprises. His remarks were made during the recent Colombo Economic Summit, emphasising a proactive approach to modernising the business landscape in Sri Lanka.
SEC Chairman Professor Harindra Dissabandara told The Sunday Times Business that the government has indicated that some of the SOEs will come into the capital market. “The mandate to bring SOE into the CSE is there, and there is no barrier. There are certain profitable and some workable SOEs that the government is looking at.”
He explained that with the IMF conditions prohibiting borrowings, certain state entities need to come into the capital market. He said that some entities are doing their preparation to get into the stock market.
Meanwhile, the CSE is in touch with several state small and medium enterprises, and there are about 20 to 30 companies in the pipeline working with the investment bankers, which is a positive trend, he added. “There is a stage in the SME life cycle when they come to a mature stage, and we must help them to raise capital. That is why we are in discussion with the banks to assist them in this journey,” he told a forum on Tuesday.
Meanwhile, out of the 217,000 companies registered, 65,000 are active while only 25,000 are strong in the market, Mr Samarasinghe pointed out.
Reiterating that listing SOEs is not ‘privatisation’ but ‘equalisation’, Prof. Dissabandara said that it is important to make people aware of this. Drawing from examples in Vietnam, he said that sentiment in that country was similar to that of here, but the Vietnamese government used an attractive word to disseminate the proper message to the people and came out on top.
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