Oct 31, 2011 (LBO) – Sri Lankan shares closed lower despite early gains with turnover boosted by the acquisition of a stake in Galadari Hotel by an investment fund linked to the Dubai government and other private deals, brokers said. The main All Share Price Index fell 0.46 percent (29.19 points) to 6,319.25, while the more liquid Milanka index dropped 0.54 percent (30.61 points) to close at 5,631.28, according to stock exchange figures.
Turnover was 2.39 billion rupees.
The heavily indebted Galadari Hotels (Lanka) was the most actively traded stock with a big stake changing hands at a slight premium and closed at 30.90 rupees, up 1.30, with 32.7 million shares traded. It hit a high of 36.60 rupees during the day.
An investment fund linked to the Dubai government bought a 29.5 million shares or a 16.1 percent stake in the firm at 40 rupees a share in a deal valued at 1.18 billion rupees.
The trades accounted for the day’s highest turnover of 1.29 billionn rupees.
Earlier this month Galadari Hotels said its board of directors had approved a price of 15.26 rupees a share to convert debt to equity.
The hotel owse 5.75 billion rupees (52 million US dollars) to the parent firm Galadari Brothers Company and 583 million rupees owed to the Sri Lankan government’s National Insurance Trust Fund.
There were four crossings of Commercial Bank of over two million shares, three at 108.50 rupees a share and one at 108.60.
Commercial Bank closed at 108.40 rupees, up 30 cents. Transactions in Commercial Bank accounted for the second highest turnover with 2.4 million shares traded in deals worth 264 million rupees.
John Keells Holdings closed at 189.10 rupees, down 1.40, with 739,800 shares changing hands, generating the day’s third highest turnover.
Nation Lanka Finance was also actively traded, closing at 16.60 rupees, down 1.70 rupees, with 1.4 million shares done.