The Ceylinco Consolidated Group is in talks with Rating Agency Malaysia (RAM) to sell off its equity stake in Lanka Ratings Agency, a top official said. The Ceylinco Consolidated Group is in talks with Rating Agency Malaysia (RAM) to sell off its equity stake in Lanka Ratings Agency, a top official said. Lanka Ratings is a joint venture between RAM (Malaysia’s largest domestic rating agency) and Key Research & Information Ltd – a member of Ceylinco Consolidated. Key Research owns 51 percent and RAM 49 percent of the Rs. 35 million venture.
The change of guard comes as Sri Lanka’s second rating agency, tries to get recognition as serious player in the local debt market.
Operating for over a year, Lanka Ratings has not had a smooth ride, as market players perceive it to be an extension of the Ceylinco Group. The uneasy feeling comes despite the securities watchdog, asking all credit rating agencies to refrain from rating any company which it has an interest – financial or otherwise.
“We want to keep it independent, but the perception was not changing and the Malaysian partners made us an offer which we are now looking at,” Ceylinco Consolidated Chairman Lalith Kotelawala said recently.
The deal is expected to be wrapped up in the coming weeks.
Sri Lanka’s maiden rating agency Fitch Ratings Lanka has been in operation for five-years. Despite the local capital markets still at a nascent stage, Fitch has rated 57 issues on 39 entities so far.
The local debt market is dominated by government debt that stands at over a trillion rupees.
(US$ 1 = Rs. 99.71)
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