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| Sunday, 28 September 2003 |
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CIC seeks new horizons "We are in the process of forging an alliance with the C.P. Group of Thailand for a venture to grow freshwater fish and prawns." - CIC Chairman The CIC Group of Companies acquired a 34.5 per cent stake of Link Natural Products (Pvt) Ltd last week. This amounts to 1,850,000 shares valued at Rs 25 a share. The company plans to increase its stake in the new venture to 49 per cent of the voting equity in the near future with the purchase of 797,000 shares held by a premier development bank. "In addition, we are also negotiating with a venture capital company holding 2,333,000 debentures valued at Rs 10 which are convertible (Rs 23 million), to issue them to us as non-voting shares. The deal, once concluded, will help us increase our stake in Link Natural to 65 per cent," said Chairman and Chief Executive Officer Chemical Industries (Colombo)/CIC B.R.L. Fernando. Link natural products Managing Director Dr Devapriya Nugawela, who holds a PhD from Manchester, will continue as the Chairman and CEO while CIC Executive Directors B.R.L. Fernando, M.P. Jayawardena and S.P.S. Ranatunga will serve as Non-executive Directors. Fernando said that Link Natural Products was looking for a strategic investor and was approached by CIC, which is involved in agriculture and experiments heavily on herbal medicinal extracts. "CIC was conducting in-house experiments using natural products and we have been successful in extracting bromalane (a protein) from pineapple, which is used in a large number of Western medicines. Therefore, this venture is an ideal match with what we were trying to do," he said. There is tremendous potential for exports and the company will start experimenting immediately, he added. The world is moving towards natural products (functional foods). Valued presently at one billion dollars, the sector is forecast to increase rapidly within the next few years. The bio-diversity per square mile in Sri Lanka is one of the highest in the world and it is one our main assets. Therefore, we should take advantage of it and diversify, which will help solve the unemployment problem and also bring us foreign currency, said Fernando. Group Finance Director P. Jayawardena said this acquisition will give a tremendous boost to the CIC Group's turnover, which is expected to exceed nine billion rupees. He said the limiting factor of Link Natural Products was working capital. "Therefore, we can, and will certainly expand as they have an excellent distribution network and all other facilities." Link Natural exports 17 per cent of its products and plans are underway to increase exports and the portfolio of products. Incorporated in 1982, Link Natural Products began operations with the production of spice essential oils for export such as nutmeg oil, cardamom oil, blackpepper oil, clove bud oil, cinnamon bark oil and ginger oil. The company diversified into the production of generic ayurvedic pharmaceuticals in 1984 and by the end of 1989, became the first to market quality-controlled factory-produced generic ayurvedic pharmaceuticals in Sri Lanka. It started developing its own range of herbal healthcare products in 1995. After research and development, the company introduced its first herbal healthcare product, Link Samahan. Other healthcare products it has developed are Link Kesha, Link Muscleguard and Link Sudantha. Some of its products are exported while a few others are yet to be launched. The company installed a spice oleoresin production unit in August 2002 as an extension to its essential oils operation. Five healthcare products are now being developed by the research and development division. The quality management system and product development system have been certified for quality by international bodies. (SG) |
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