1 June 2016 10:52 am
“The economic policy pronouncements of the government signalled its desire to encourage public private partnerships and exit investments in non-core public owned interests and, this, we believe would give rise to opportunities for the group, given our strong balance sheet,” JKH Chairman Susantha Ratnayake said in the company’s latest annual report released yesterday. The 2016 budget said that the government would divest its shares in government owned entities such as Lanka Hospitals, Colombo Hilton, Hyatt Residencies,
Waters Edge, Grand Oriental Hotel and Mobitel. “This augurs well for the private sector, in general, and for our group, in particular. The details of the policies and timelines in this regard are expected to be announced during the latter half of the calendar year 2016,” the annual report noted. Since JKH is the country’s largest leisure sector operator, it may be looking at acquiring some of the hotels the government currently owns. The annual report noted that despite near-term outlooks for the ports, bunkering and logistics businesses look grim due to downturns in global trade and commodity markets, JKH would participate in the government’s recently published expression of interest to build and operate the East Container Terminal (ECT) in Colombo. It added that long-term outlooks for the logistics industry look positive for Sri Lanka, given Colombo being the premier port in the South Asian region. The group is the largest shareholder of the South Asian Gateway Terminals (SAGT) at the Colombo Port. “The group will look to leverage on this investment opportunity considering… the ability for the ECT to cater to larger vessels which will complement the operations of SAGT considering its back to back location which will facilitate operational efficiencies,” the annual report said. It added that the group will also participate in the recently opened tenders for bunkering operations in Hambantota Port. This could prove lucrative given the port’s proximity to the East-West shipping lane. “Considering these plans as outlined by the government, the group will look to capitalise on the opportunities within the Port of Hambantota, which are expected to materialise in the near term,” it said.