Cabinet grants approval for sale of state’s ownership in SLT and Lanka Hospitals

• Divestment of shares will be implemented by state-owned Enterprise Restructuring Unit

Sri Lanka Telecom PLC (SLT) and Lanka Hospitals Corporation PLC yesterday informed the Colombo Stock Exchange that they had received letters from the Treasury secretary, informing that the Cabinet of Ministers had granted approval in principle for the sale of the major shareholding in both companies. 

According to the filing by SLT, the divestment of shares will be implemented by the state-owned Enterprise Restructuring Unit, established under the Finance, Economic Stabilisation and National Policies Ministry, subject to following due process.

The Treasury secretary has a 49.5 percent stake or 893.4 million shares of SLT, while state-owned Sri Lanka Insurance has an over 51 percent stake in Lanka Hospitals Corporation.

In addition, state-run banks and pension funds also have stakes in these two companies. 

Delivering the 2023 budget speech, President Ranil Wickremesinghe revealed the plans to restructure SLT, Sri Lanka Insurance Corporation, Waters Edge, Colombo Hilton and SriLankan Airlines. 

He said the proceeds from the sale of the state’s ownership in these entities would be used to bolster the country’s foreign reserves.  

The government expects to earn at least US $ 1.5-2 billion from the state-owned enterprise (SOE) sales.

However, there is much opposition, particularly towards the sale of the state’s ownership in SLT and Sri Lanka Insurance Corporation, as they remain among the few SOEs that are making profits.