Lion Brewery goes for Rs. 1.2 b
Rights Issue

Lion Brewery (Ceylon) Plc, last week announced its decision to raise Rs. 1.2 billion via a Rights Issue.
The funds would be raised via a three for five Rights Issue offering 30 million shares at Rs. 40 each. Its current stated capital is Rs. 1.3 billion. As of 2008/9 financial year, its net assets per share was Rs. 36.63 whilst yesterday the share was trading at between Rs. 76 and 78 before closing at the latter value, up by Rs. 2 from Monday.
The primary reason for the Rights Issue is to reduce the current gearing level of the Company.
As of March 31, 2009, the Company had a Bank overdraft of Rs. 1.26 billion and a short term loan of Rs. 400 million.
Ceylon Brewery Plc owns 50.4% stake in Lion whilst Carlsberg Brewery Malaysia owns 24.6% whilst other major shareholders include Genesis Smaller Companies fund nearly 10% and Arisaig India Fund 6%.
In 2008/9 financial year, the Lion saw its revenue topping the Rs. 6 billion mark from Rs. 5.2 billion in the previous year. Profit from operations was Rs. 473.2 million, up from Rs. 384 million in 2007/8. However finance expenses which was Rs. 391 million as opposed to Rs. 230 million, saw its pre-tax profit dip to Rs. 82 million, in comparison to Rs. 154 million in 2007/8.