Last Friday, Dhammika Perera’s Hayleys bought 40.6 percent of Harischandra Mills for 2.6 billion rupees. The seller was Senthilverl Holdings, who sold at 3300 rupees a share.
On Wednesday, Hayleys announced its entry into the supermarket sector, with 100 outlets to start. Yesterday, the company made a mandatory offer to Harischandra shareholders, as is legally required, offering to purchase all remaining Harischandra shares at 3300 rupees.
Udeeshan Jonas, chief strategist at Capital Alliance, an investment bank, said that Perera would want a controlling stake in Harsichandra. Buying the shares wouldn’t “make sense” otherwise. “Sometimes he doesn’t have the patience to kind of wait through and secure it,” Jonas added.
Harischandra never garnered much attention on the stock market. “In the past, many people have been trying to buy it out, but obviously due to the shareholding being very split, no one was able to take control,” says Jonas. “The problem is that no one really wanted to put their foot down.”
For T. Senthilverl — from whom Perera purchased the stake at Harischandra — the food and beverage company was a portfolio investment. A low-profile, high-net worth investor, Dr. Senthilverl is said to have been collecting shares at Harischandra for nearly two decades.
“He’s not a person who runs a company. He was holding on to it, and I think this is the ideal exit for him,” said Jonas.
By contrast, Perera isn’t a trader. He’s more interested in taking over companies to turn them around, according to Imtiaz Buhardeen, group chair at Almas Holdings, an investment company.
Perera’s recent behaviour at the stock market suggests he is doubling down on this characteristic— he has been selling his passive investments in companies like Seylan Bank and Commercial Bank while focusing on obtaining controlling stakes in others.
Perera’s binge at the stock market this year includes the acquisition of majority stakes at firms heavily exposed to domestic consumer demand — Associated Motor Finance, East West Properties, and DHT Cement. He also made headlines in September when he acquired a 50 percent stake in Laugfs — the only private player in the island’s gas duopoly.
But according to Laugfs chair W.K.H. Wegapitiya, Perera didn’t ask for a controlling stake in the company.
Perera bought 39 percent of Laugfs from Wegapitiya’s co-founder who wished to exit. Wegapitiya divested another 11 percent. As a result, Perera doesn’t have control. But neither does Wegapitiya.
