The real estate giant Prime Group announced acquisition of 75.5% of stake in Summit Finance PLC for Rs. 510 million from Sarvodaya Development Finance Ltd. Summit Finance PLC will be re branded as Prime Finance PLC and will continue as a subsidiary of Prime Group. Prime Group will invest a further capital of Rs. 207 million in Summit Finance and also raise further Rs. 68 million from the general public to make it Rs. 275 million.
Prime Group is the leader in real estate sector in Sri Lanka with more than 21 years of extensive experience in the land, housing and property development. Currently the land and property development projects are spanning across 13 districts covering depth and breadth of Sri Lanka with having successfully completed over 1000 land projects under its belt and over 32 apartment projects in Colombo and Suburbs. Over the years Prime Group and its subsidiaries have earned most of the industry’s highest awards and accolades at numerous times both locally as well as internationally.
This isn’t the first foray into acquisitions in the field of finance for the Prime Group. The Group acquired Grameen Micro Credit Company Ltd., a troubled and loss making micro finance company in 2011 and turned it around to be a profitable top finance company within a short span of period.
Summit Finance PLC will maintain its head office in Colombo along with its 6 branch offices in Gampaha, Kaluthara, Negombo, Wennappuwa, Kurunegala and Kandy and the branch network will be expanded in other areas of the Island under the new leadership.
The company will be expected to concentrate more or less on high potential, untapped business needs of selected customer segments going beyond the contemporary vehicle financing. While huge changes to the current business strategy is expected, new business strategies to exploit the group synergies by focusing more on to real estate requirements of customers who are not lucky enough to satisfy their financial requirements through banks will be drawn up. The company also stated that there are plans to develop and introduce new loan products to SME and below SME segments by closely studying their credit appetite (non-consumption base) at affordable premiums.
Prime Group stated that the industry veterans and professionals will be appointed to its board of directors to bring tremendous experience and value to further strengthen and diversify. The new board will comprise of Mr. Mangala Goonatilleke – Chairman, Mrs. Sandamini Perera – Deputy Chairperson, Mr. Brahmanage Premalal – Group Chairman, Mr. Nandana A. Wickramage – Director, Mr. Pathirage Anura Wijesiri Perera – Director, Mr. Mahinda Perera – Director, Mr. Dhammika Kalapuge – Director, Mr. H.M.Hennayake Bandara – Director and Mr. D. Pramuditha V. Mendis – CEO
Mr. B. Premalal, Group Chairman Prime Group added: “Prime Group has the scale and resources, together with past experience in turning around loss making finance companies to profitable ventures and we are confident that we will be able to strengthen and grow this finance company which already has a captivating market. This is great news for our customers and creates significant growth opportunities for our group business.”
Commenting on the acquisition, Mrs. Sandamini Perera Deputy Chairperson, Prime Group said: “We are very pleased and excited. This transaction will further strengthen the business we have developed and grown over 21 years. Also it will be a wonderful opportunity for our real estate customers who will have access to innovative financial loan products as well as all our stakeholders benefiting from this.”