John Keells Holdings Plc, Sri Lanka’s biggest conglomerate, has been given approval to build a $850 million luxury resort that will include hotels, shops and apartments, Investment Promotion Minister Lakshman Yapa Abeywardena said.
 
“John Keells earlier proposed $650 million, but now they have said they are willing to invest $850 million. We have given approval for the proposal with all the appropriate tax concessions,” Abeywardena told reporters in Colombo on Thursday.

Shares in Keells rose 3.42 percent to 254.00 rupees at 0707 GMT as investors bet the enlarged project would boost Keells’ earnings when it is completed in five years time, despite worries about how the resort will be paid for.

“Some investors have concerns over how the company is going to finance the project,” one stockbroker said on condition of anonymity.

Board of Investment chairman Lakshman Jayaweera told reporters that Keells had said the project would attract $300 million in foreign direct investment, and that a Keells subsidiary would go for a rights issue to raise $300 million internationally.

Officials from Keells declined to comment on the financing.

Keells, the biggest company on the Colombo Stock Exchange with more than $1.6 billion market capitalisation, said in a disclosure to the bourse on Wednesday that its board had approved the building of a luxury resort worth more than $650 million. – Reuters