Watawala Plantations PLC, one of Sri Lanka’s largest plantation companies plans to separate its tea business from other businesses of the company and form two separate, independent, listed companies.
The separation will be made under an arrangement which will be subject to court approval under the Companies Act.
Watawala Plantations stated that the separation of the business activities will enable the two companies to focus on their respective areas of activity and achieve strategic specialization.
Moreover, it will further enable their respective boards to adopt financial and operational policies which are appropriate for their respective strategic objectives.
Watawala Plantations PLC further stated that following the arrangement the existing shareholders of Watawala Plantations PLC will be entitled to identical shareholdings in the new company.
Following the segregation, the employees of the 2 companies will continue to enjoy their existing benefits and privileges under the recent terms of employment and there will be no negative impact on their existing entitlements. The Board of Watawala Plantations PLC further stated that the proposed segregation will, in addition to creating greater opportunities for specialization also enable the companies to attract investments and know-how from investors with an interest in respective areas of business activities.