CSE News Updates

By Indika Sakalasooriya and Jithendra Antonio

The engineering arm of Sumal Perera’s Access Group, Access Engineering, is raising Rs.4.5 billion in a private placement deal, Mirror Business learns. The offer officially opens today.

Back in March Mirror Business exclusively reported that Access Engineering is hoping to go public by end of May and the company was contemplating on a pre-IPO private placement.

However, it is now learnt that Access Engineering is offering 18.37% of the company or 180 million shares for private investors each share valued at Rs.25. This is the second largest private placement deal recorded after the Rs.4.9 billion Vallibel One private placement.

Following the private placement, it is anticipated that Access Engineering IPO will raise Rs.500 million by December this year, offering nearly 20 million shares at the same price of the private placement which is Rs.25.

As the Company will seek a listing on the CSE subsequent to the private placement, the shares held by placement parties would be subject to a ‘‘lock-  in’’ for a period of one year as per SEC regulation.

It is further learnt that Rs.600 million of the private placement proceeding will go to retire debts, improve working capital (about Rs.1 billion), finance property development and water management and hydro based electricity generation projects, engage in strategic investments and set up a leisure sector arm for the company.

The intended placement parties should apply for minimum Rs.10 million worth of shares (400, 000 shares) and in Multiples of 200,000 Shares i.e. for Rs. 5 million thereof.

Access engineering was incorporated in 2001 and functions as the holding company of Access Engineering Group which includes a fully owned subsidiary, Access Realties (Private) Limited (ARL). AEL carries out the Group’s engineering business whilst ARL owns, Access Towers which contributes to the major portion of its revenue through rental income.

The audited financial accounts of the company showed that firm’s revenue had increased from Rs.3.175 billion in the Financial Year 2010 to Rs.3.651 billion in Financial Year 2011. Subsequently, the company also reported a net profit of Rs.1.16 billion in 2011, up from Rs.850 million in 2010.

The accounts also outlined that Access Engineering’s assets are valued at Rs.5.7 billion to date and Net Asset Value Per Share (NAVPS) stands at Rs.5.43 whilst Earnings Per Share (EPS) is Rs.1.20. The company’s Price to forward Earnings Ratio is valued at 20.83 times while the price to Book Value is considered to be 4.6 times.

Access Engineering is a fully integrated engineering company operating in roads and highways, bridges and flyovers, water and waste water management, habours and marine works, dredging and reclamation, telecommunication, irrigation and land drainage, piling and environment and waste management sectors.

source - www.dailymirror.lk