June 03, 2008 (LBO) – An initial public offering of Janashakthi Insurance would open on June 16, the Colombo Stock Exchange said, making it the first initial public offering in two years. However, 30 percent revenue growth, beating the industry average in the early part of the decade, has slowed to 18 percent in 2006 and eight percent a year later.
The 15-year-old company is 90 percent owned by the Schaffter family, four of whom are also directors.
“New shares worth 400 million, amounting to 10 percent of Janashakthi’s issued capital will be offered through the IPO,” says managing director Prakash Schaffter who is however the only family member with an executive role.
If investors take up the entire issue, including the optional 200 million, Schaffter family control in the company will fall to 80 percent with IPO shareholders controlling 10 percent while another 10 percent in equity is already held by other shareholders.
Profits in the March quarter jumped to 58 million rupees up from an 85 million rupee loss in the same period last year.
After a recent share split the company’s per-share profit was 1.59 rupees for 2007 at 12 rupees.