By: Staff Writer
Colombo (LNW): Canwill Holdings parent company of Sinolanka one of the present majority stake holders of Grand Hyatt Colombo (GHC)” a 47 level skyscraper that was to house an iconic 5 star luxury class hotel and serviced apartments is on its way towards divestiture.
Expressions of interest have been called for for divestment of Grand Hyatt Colombo marred with corruption and controversies during the previous Mahinda Rajapaksa regime.
This an uncompleted building even after spending a staggering Rs. 21.6 billion is still to be completed. , official sources said.
The Government of Sri Lanka (GoSL) intends to divest all or part of equity shareholding in Canwill, the parent company to Sinolanka Hotels & Spa (Pvt) Ltd (Sinolanka) and Helanco Hotels & Spa (Pvt) Ltd (Helanco).
Sinolanka the owner of an under-construction top tier landmark hospitality asset in er Colombo, built to Grand Hyatt specks since Sinolanka has entered into a hotel management agreement with Hyatt International- Southwest Asia Ltd.
The property features an impressive 47-story structure with 458 rooms and an additional 100 serviced apartments, all situated on 2.32 acres of prime oceanfront real estate. The total built-up area encompasses a vast 1,340,562 square feet.
Helanco holds 9.42 acres of beachfront leasehold land in the southern city of Hambantota.
GoSL will implement this divestiture via its State-Owned Enterprise Restructuring Unit and Deloitte Touche Tohmatsu India LLP (DTTILLP) has been appointed as the Transaction Advisor. The divestiture will be completed through a two-stage competitive bidding process.
The total GHC project cost has been estimated at approximately US $ 302 million (Rs. 45.3 billion) excluding interest cost (if) and CESS and NBT.
The physical progress of the project as it stands now is around 61.67 percent and the expected date of completion would be uncertain as the construction work has been halted owing to, ongoing legal issues and shortage of funds.
The cost for the completion of a room at this hotel was Rs 82 million whereas a similar room of Shangri-La hotel had been completed at a cost of Rs 42 million, a senior treasury official said.
The then good governess government had earlier planned to operate the Grand Hyatt project e as a five-star hotel with 458 rooms and 100 serviced apartments, once completed.
The management contract entered into with the Hyatt Group expires 20 years after the start of operation.
In an attempt to restructure the project ownership of Canwill Holdings Ltd. and divest the Government stake in the company, action has been taken to find a suitable investor by calling for proposals on 2018.
However restructuring process has to be suspended on the directions of 52 day unconstitutional administration headed by Mahinda Rajapaksa in the later part of 2018.
