Fairfax acquires Khazanah stake in Sri Lanka firm

A unit of Fairfax bought the stake from Khazanah Nasional Bhd, which exited the company

COLOMBO: Canadian investor Prem Watsa’s Fairfax Financial Holdings Ltd has acquired a stake in John Keells Holdings Plc, Sri Lanka’s biggest company by market value, people with knowledge of the matter said.

About 10.8% of John Keells shares exchanged hands at 160 rupees apiece on Thursday according to exchange filings.

A unit of Fairfax bought the stake from Khazanah Nasional Bhd, which exited the company, the people said, asking not to be identified before a public announcement.

Malaysia’s sovereign wealth fund had acquired the stake in March 2012 for about 194 rupees apiece.

Fairfax is expanding its presence in Sri Lanka as theisland-nation’s economy recovers from a devastating terrorattack in April.

Central bank governor Weligamage Don Lakshman last month said he expected growth to accelerate to as much as 6.5% after 2020.The Canadian firm also owns stake in NationsTrust Bank Plc, which counts John Keells as its biggestinvestor, and runs a general insurer in the nation.

John Keells’ shares rose 1.1% to 162.8 rupees in Colombo on Thursday.

Citigroup Inc’s brokerage unit acquired the John Keells’ shares, CT CLSA Securities Pvt said in a filing with the Colombo Stock Exchange on Thursday, confirming the price and amount of shares.

Khazanah’s representative declined to comment on thematter.

A phone call to Fairfax’s office was unanswered outside of business hours in Canada.

Khazanah has been selling stakes in companies from Alibaba Group Holding Ltd to Infosys Ltd as part of its divestment streak to free up cash for reinvestment.

A series of coordinated explosions in April at churches and luxury hotels around Colombo killed more than 250 people prompting tourists to flee from the nation famous for the Temple of Tooth, Dambulla Caves and coconut-fringed beaches.

Tourism accounts for 5% of the economy. — Bloomberg

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