Sri Lanka’s city development agency to issue a billion rupees in bonds

June 21, 2006 (LBO) – Sri Lanka’s Urban Development Authority (UDA) plans to raise a billion rupees in bonds to finance an office development project, top officials said Wednesday. The UDA will appoint a banking partner within the next two months, Jayaweera said, with an issue date to be fixed, perhaps for later this year. “We are trying to raise 2.2 billion rupees for a project called ‘Sethsiripaya II’ and will be issuing debentures for one billion rupees,” D S Jayaweera, Chairman of the UDA, told LBO.

The ten-year issue will be in a mix of small and larger denominations, with the balance project capital raised through internal funds.

“We are in the process of calling for quotations from banks to manage the issue and are looking at the state banks – People’s Bank and Bank of Ceylon, DFCC Bank, National Development Bank, Peoples Merchant Bank and others,” Jayaweera said.

“We want to encourage interest in the issue from high to middle income groups and so the issue will be in small as well as large lots.”

The proceeds of the issue will be invested in a new company called Urban Investment and Development Company, which will also undertake other development projects.

The Sethsiripaya II project will include space for state departments including the Attorney General’s Department, all revenue departments of the Treasury as well as some ministries.

In all, the 300,000 square foot block will provide for a floating population of about 40,000 people, Jayaweera said, to be expanded further in a later phase.