Wednesday, September 20, 2017


Sri Lanka: Hayleys expansion into Retail with Singer augur well with Government’s plan in making a Retail Hub

Original Date of the Article - Tuesday, September 19, 2017
By Jithendra Antonio

• Acquisition makes Billionaire Dhammika Perera control US $ 1.4 Bn worth of Listed Equities in a US $ 18.7 billion Capital Market with 32 listed entities

• Acquisition makes Billionaire Dhammika Perera now controlling 2 licensed commercial banks, 4 finance companies

• Dhammika Perera emerges to be Billionaire who controls Superior Brands in Sri Lanka including Hayleys, Singer, Rocell, Alumex, Lanka Tiles, Lanka Walltiles, Lanka Ceramic, Sampath Bank, LB Finance, Vallibel, and many more

Sri Lankan Billionaire Kulappuarachchige Don Dhammika Perera and consortium controlled (over 51%) Hayleys PLC and its subsidiaries recently announced the purchase of 61.73 percent of shares of Sri Lanka’s largest retail chain Singer (Sri Lanka) PLC that has over 422 retail outlets across the country, for a consideration of over Rs. 10.9 billion, making it the single largest acquisition of a listed company in Sri Lanka in recent times.

Kulappuarachchige Don Dhammika Perera
This also marks Dhammika Perera’s achievement in taking over the control ownership of US $ 1.4 billion or over Rs. 223.1 billion worth of Listed Equities in Sri Lanka, controlling 8.51% of Market Capitalization of the US $ 18.7 billion or over Rs. 2.9 trillion worth Capital Market in the country; having a larger footing into 32 listed companies among a total of 295 listed companies in Sri Lanka.

Perera’s entities are said to be paying over 5% Sri Lanka Government’s Tax Revenue amounting to over Rs. 84 billion out of over Rs. 1.6 trillion Government incomes. This makes indirectly Dhammika Perera controlling nearly 2% worth of wealth via listed equities alone in the US $ 81 billion or Rs. 11.9 trillion worth South Asian Emerging Economy, where he has provided employment to nearly 50,000.

He has two listed investment arms tiled ‘Vallibel One PLC where he has over 63% personal stake and Hayleys PLC where he has over 47% personal stake. Hayleys has over 28,000 employees whilst Vallibel One has over 13,000 employees. His humble beginnings in business began with Casinos slowly taking the control of three prestigious and premier Gaming and Entertainment Casino brands in the country with Bally’s Colombo, Bellagio Colombo, and MGM Colombo. Perera controls almost over 75% of Sri Lanka’s gaming market for last 2 decades in a country where gambling has strict regulations and higher taxation due to 68% of the 21 million population being Buddhists; also where in May this year decorations in the heart of Colombo 03, Colombo 02 of 14th United Nations International Day of Vesak celebrations held in Sri Lanka was entirely sponsored by Perera controlled LB Finance PLC.

Hayleys PLC’s largely owned by Dhammika Perera brings approximately 3.53% of Sri Lanka’s export income in Dollars, and 3.4% of tea and 3.8% of Rubber production. He also owns 6% of non-medical rubber glove market in the world via Dipped Products PLC. Perera also owns Rocell (Royal Ceramic Group) via Vallibel One PLC and controls 90% of Sri Lankan Tile Market with Lanka Tiles, Lanka Ceramic, Lanka Walltile, Swisstek Ceylon and controls 90% of Sri Lankan Aluminum Market and 90% of Sri Lankan Aluminum Extrusion Market via Alumex PLC, Lanka Aluminium Industries PLC, Alufab PLC-Hayleys Group with best hotels that comes under Amaya Resorts & Spas along with country's best Honeymoon hotel Amaya Hunas Falls.

Perera also owns 15% of leading innovative licensed commercial bank - Sampath Bank PLC via Vallibel One and has a 30% personal stake in licensed commercial bank Pan Asia Banking Corporation PLC. He also owns one of the leading largest finance company - LB Finance PLC, Vallibel Finance PLC, Fentons Limited, Delmege Group, the 5 Star Luxury Boutique Hotel The Fortress Resorts, Energy company Vallibel Power Erathna, The Kingsbury Hotel, Kingsbury Platinum 1 Luxury Apartments, with investments into plantations via Hayleys and owns Mabroc Bubble Tea brand in Sri Lanka. Early this year he has disclosed to country’s capital market under Hayleys that he will build World Export Center in Sri Lanka with Twin Towers each having 55 Floors and 3.8 million Square Feet at Colombo 10, Hayleys Head Office property at No.400, Deans Road, a land currently valued at over Rs. 10.39 billion or US $ 67 Million; 717.59 perches land at over Rs.14.4 Million a perch. In July 2016, Hayleys Leisure arm Amaya ventured into Maldives through its US $ 23 million acquisition of a luxury resort with 51 villas.

In a release issued by the company, Hayleys said Singer’s strategic acquisition by Hayleys PLC and its subsidiaries is anticipated to yield substantial opportunities for new business synergies within the Hayleys group. Both Hayleys PLC and Singer (Sri Lanka ) PLC collectively account for over 280 years of experience in the Sri Lankan market.

Dhammika Perera, who is also the Co-Chairman, Hayleys PLC, has stated in an official release, that Singer’s acquisition is no doubt the biggest in Sri Lanka.

“Given the strength of Singer Sri Lanka, one of the most iconic and trusted retail brands in the country, we believe that with this move, the Hayleys group will be able to leverage and amalgamate the expertise and know-how of two corporate giants and boost the group’s growth trajectory.”

Hayleys, the largest Sri Lankan conglomerate nearing its 140th year, has a global presence in 15 countries across all 5 continents. It is the most diversified conglomerate in the country and this acquisition creates a total of 16 Public Listed Companies under the Hayleys group umbrella. Established in 1878, Hayleys PLC is one of Sri Lanka’s largest, multinational business conglomerates driving a globally competitive business portfolio cutting across manufacturing, agriculture, and services and reported over Rs. 111 billion revenue in last financial year for the first time. The group is internationally recognized as a leader in innovation and currently operates manufacturing and service facilities in Sri Lanka, Indonesia, Myanmar, Maldives, Thailand, Bangladesh, and Singapore. Its Marketing facilities are located in Australia, India, Malaysia, Italy, Japan, The Netherlands, UK, and the USA.

Sri Lanka’s Government has plans to make Sri Lanka a Retail Hub so that consumers from our neighboring countries will come to Sri Lanka to shop for clothing, perfume, jewellery, watches, smartphones, laptops, small televisions, audios and small appliances. In this connection, a significant step was the announcement at the National Budget 2017 to create a Sri Lanka Shopping Festival in line with those held in other shopping capitals of the region. Thus, Singer Sri Lanka brand acquisition by Dhammika Perera led Hayleys makes it easier for Hayleys to dominate Sri Lankan Retail market via 422 island-wide outlets and Singer Mega stores. Singer sells HUAWEI and SONY branded mobile phones in both retail and wholesale and is the exclusive national distributor for these brands.

The Company also sells SAMSUNG and APPLE phones in selected retail outlets. As per financials Singer has sold 312,900 smart phones including tablets and media pads, whilst it has increased to 488,500 in 2016. Singer’s Digital Media channel continued its growth, with a 49% growth in 2016 and works through distributors and reaches close to 2000 small outlets selling mobile phones, accessories, and connections.

Singer Sri Lanka acquisition by Dhammika Perera led Hayleys is the first time ever that a Sri Lanka born and Sri Lanka resided Billionaire led, one of the oldest domestically British founded conglomerate had spent over the US $ 70.4 million by paying the Dutch owners of Singer Asia - Retail Holdings NV in the 2,500 years of recorded history of Sri Lanka. Simply it is the first time a Dutch-owned company had been purchased by a Sri Lankan company for such a value exceeding Rs. 10 billion upon Sri Lanka started emerging into an independent economy after 1948 getting independence from Colonial Rule, which fell into the Portuguese in 1505 which then transferred to Dutch in 1640’s and then to British in the year 1796.

Retail Holdings NV is a Curacao (formerly the Netherlands Antilles) public company that is the successor company to the Singer Company N.V. and its predecessor companies. The Company has as its principal asset, a 54.1% equity interest in Sewko Holdings Limited (“Sewko”), the parent company of Singer Asia Limited, with retail and financial services businesses in Bangladesh, India, and Sri Lanka (before Hayleys acquired the stake). Sewko’s core business is the distribution of consumer durable products, primarily for the home, with supportive manufacturing, and with consumer credit and other financial services. The Company has no operating activities other than those carried out through Sewko.