Lofty Plans

Chandi Dharmaratne

June 23, 2010 (LBO) – A unit of Sri Lankan high-end retailer Odel may reconsider to build a shopping mall with the parent firm making a full provision to cover a 45.2 million rupee loan due from the unit, its share issue prospectus showed. “Although yet to commence operations, this Board of Investments (BOI) approved company was incorporated to plan the preliminary activities required to construct a high-rise shopping mall complex,” its prospectus said.

On July 24, 2006, the subsidiary Odel Lanka had inked a deal with the Sri Lankan investment agency granting it a tax holiday for the first six years after the mall commencing operations.

After completion of the tax holiday Odel Lanka would pay taxes at a concessionary rate of 10 percent for two years and 15 percent for a further two years, its prospectus said.

Other group companies Odel Technology Services (Private) Limited, and Odel Properties (Private) Limited have also been granted similar tax concessions by the BOI.

Odel plans to raise 250.5 million rupees from an initial public offering (IPO) next month to retire short-term debt and expand.

The group had take 1.671 billion rupees in debt, and has paid back 665.3 million rupees, its prospectus showed.