July 07, 2010 (LBO) – Tea bag exporter Ceylon Tea Services, part of Sri Lanka’s Dilmah brand group, is to invest 233.3 million rupees in a tea plantations subsidiary of the parent firm, a statement said. Ceylon Tea Services said in a stock exchange filing that it bought 15,553,600 rights in Kahawatte Plantations from Forbes Plantations, which is owned by MJF group, at two rupees a share for 31.4 million rupees on Tuesday.
“This entitles the company to subscribe for 15,553,600 ordinary shares in Kahawatte Plantations, 19.47 percent of the shares representing the ultimate stated capital if the rights issue is fully subscribed,” it said.
The company plans to invest another 233.3 million rupees to subscribe for the ordinary shares at 15 rupees a share.
Ceylon Tea Services holding company is MJF group which is also the holding company of Forbes Plantations.
Sri Lanka’s stock market has been on the upswing this year, hitting new highs, although it suffered a correction this week.
Tea prices have also been strong on the back of strong demand, boosting tea plantations profits.