|Cargills and Millers to merge
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|Author:||Peter [ Fri Aug 03, 2007 4:04 pm ]|
|Post subject:||Cargills and Millers to merge|
Sri Lankan colonial era business houses announce merger
Cargills (Ceylon) Ltd and Millers plc both own landmark buildings in Colombo Fort, and are Sri Lanka's first department stores, built during British colonial times. Cargills now runs Sri Lanka's largest supermarket chain branded 'Food City.'
@ LBO / 03 August 2007
August 03, 2007 (LBO) – Millers and Cargills (Ceylon) Ltd, two firms dating back from the British colonial era, said they were merging as part of a restructuring within the Ceylon Theatres group to which they now belong.
Cargills (Ceylon) Ltd and Millers plc both own landmark buildings in Colombo Fort, and are Sri Lanka's first department stores, built during British colonial times.
The merger decision was taken at board meetings of the companies on August 02, the companies said in statements to the Colombo Stock Exchange.
"The Ceylon Theatres group, recognising the growth into diversified sectors, is now of the view that the group's activities should be sectorised for future growth," the company statement said.
"Accordingly, as a first step, . . . it was resolved to commence negotiations leading to the merger of Ceylon Theatres Ltd and Millers plc."
Under the proposed merger framework, minority shareholders of Millers will be offered shares in Ceylon Theatres in return for their holding in Millers on a basis to be determined.
The current operations of Millers are to be consolidated under a single operating structure under Cargills.
The Ceylon Theatres group is controlled by the Page family. Cargills now runs Sri Lanka's largest supermarket chain branded 'Food City.'
The companies are to obtain approval from their respective boards, regulators and shareholders after finalising the terms of the merger under the Takeovers and Mergers Code and the new Companies Act.
Ceylon Theatres has direct and indirect stakes of 57 percent in Millers and 48 percent of Cargills, according to its last published annual report. Millers has a 62 percent stake in Cargills.
Ceylon Theatres, set up in 1928 to exhibit and distribute films, acquired Cargills and Millers in the late 1970s.
It expanded further in the early 1990s into property development and financial services by setting up CT Land Development Ltd., which owns the Majestic City shopping mall and theatre in Colombo, and C T Smith Stockbrokers.
It moved into manufacturing and plantations in the late 1990s by acquiring Lanka Ceramics group which included Lanka Walltile Ltd, Lanka Tiles, and Horana Plantations.
PS: Cargill's had started as Milne and Cargill Company. Milne soon retired to Glasgow, while Cargill had other interests, including Burmah Oil. Long registered in Glasgow, Cargills was sold to Sri Lankans in 1946, but they chose to keep the Cargill's name.
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