LRI and Eighth Wonder acquire 71% stake in Lee Hedges for Rs.3.9bn

Lanka Realty Investments PLC (LRI) and Mauritius-based investment vehicle Eighth Wonder acquired a combined 71 percent stake in Lee Hedges PLC, on January 8, in a major transaction valued at approximately Rs.3.93 billion that has triggered a mandatory offer for the remaining shareholders.
The acquisition saw LRI purchasing a controlling 51 percent stake, amounting to 13,057,595 ordinary voting shares, at a price of Rs.216.00 per share. In a parallel transaction, Eighth Wonder acquired a 20.1 percent stake, comprising 5,148,684 shares, also at Rs.216.00 per share.
The acquisition aligns with LRI’s strategy to pivot from passive land banking to owning high-yielding, income-generating commercial assets. Lee Hedges controls significant real estate in Colombo 3, including the property at 353, Kollupitiya Road.
By adding Lee Hedges to its portfolio, LRI consolidates its footprint in Colombo’s commercial real estate sector. Market analysts view the acquisition as a signal of LRI’s intent to build a resilient asset base that can withstand economic volatility while capitalising on the long-term appreciation of prime city land.
Eighth Wonder, the co-acquirer in this transaction, is a known strategic partner of LRI. The Mauritius-based investment vehicle is registered in the Republic of Mauritius. Eighth Wonder has been a long-standing investor in the group and this joint acquisition underscores the continued confidence of foreign institutional capital in the potential of Sri Lanka’s real estate market.
The deal facilitates the exit of the company’s longstanding major shareholders. LRI acquired its stake from Lee Hedges & Company Limited, which held 13,057,600 shares (51.00 percent) as of September 30, 2025. Eighth Wonder purchased its block from Pioneer Homes (Private) Limited, the second-largest shareholder, which previously held 20.48 percent of the company.
With LRI acquiring a stake exceeding the 30 percent regulatory threshold, the move triggers the Takeovers and Mergers Code, compelling the acquirer to extend a mandatory offer to the minority shareholders. The offer is expected to be pegged at the transaction price of Rs.216.00 per share.
According to the interim financial statements for the period ended September 30, 2025, the net asset value per share of the Lee Hedges group stood at Rs.242.66. Consequently, the deal price of Rs.216.00 reflects a discount of approximately 11 percent to the book value.
The Lee Hedges shares closed lower last Friday, shedding Rs.12.25 or 4.82 percent to settle at Rs.241.75, down from the previous close of Rs.254.00.