October 12, Colombo (LNW): John Keells Holdings PLC (JKH) has successfully completed its Rights Issue, raising Rs. 27.43 billion, which surpasses the original goal of Rs. 24.04 billion.
Initially, the company offered 150.26 million new ordinary shares priced at Rs. 160 per share on a 1-for-10 basis, aiming to fund significant projects, including the ambitious “City of Dreams Sri Lanka” resort development.
This Rights Issue is part of JKH’s larger corporate strategy focused on strengthening its financial position and ensuring the progress of ongoing projects.
The funds will be allocated to Waterfront Properties (Private) Limited (WPL), a subsidiary of JKH responsible for developing the “City of Dreams Sri Lanka” integrated resort, previously known as the ‘Cinnamon Life Integrated Resort.’
The project has faced delays in generating cash flow, particularly in its gaming operations, resulting in a higher need for funding than initially anticipated.
Additionally, JKH has established a strategic partnership with Melco Resorts & Entertainment Limited, a leading company in the global casino and integrated resort industry.
Melco has pledged USD 125 million to equip and fit out the gaming facilities at the resort. This collaboration follows the introduction of a formal regulatory framework for casino licensing in Sri Lanka.
The “Cinnamon Life” hotel and its facilities are slated to open in October 2024, with the retail mall and gaming areas launching in stages, expected to be fully operational by mid-2025.
Alongside the Rights Issue, JKH’s Board of Directors has proposed a Share Sub-division to increase the number of shares tenfold, thereby boosting liquidity and making the stock more accessible to a broader range of investors.
This sub-division, which is pending shareholder approval, will occur following the Rights Issue, raising the total number of shares from 1.65 billion to over 16.5 billion.
The successful oversubscription of the Rights Issue reflects strong investor confidence in JKH’s long-term strategy and its capability to execute large-scale development projects.
Keells Consultants (Private) Limited, acting as the company’s secretaries, confirmed the subscription details to the Colombo Stock Exchange.
