John Keells Holdings PLC (JKH), Sri Lanka’s top blue chip company, has successfully raised Rs. 24 billion through its recent Rights Issue, which drew an oversubscription of Rs. 27.4 billion. The 1 for 10 Rights Issue offered 150.26 million shares at Rs. 160 each, with a total value of Rs. 24.04 billion. JKH also announced a share sub-division of 1 into 10, following the Rights Issue.
Upon closing, JKH received subscriptions for 171.4 million shares, reflecting strong demand from both existing shareholders and new investors. Analysts noted that the oversubscription highlights investor confidence in the company’s future prospects. JKH’s share price has also been on an upward trend, rising by Rs. 10.75 last week to close at Rs. 197, after peaking at Rs. 199.
This marks the largest Rights Issue since JKH’s Rs. 23 billion offering in 2013, which included warrants contributing over Rs. 16 billion towards a total fundraising effort of Rs. 40 billion for the integrated resort project, now branded as ‘Cinnamon Life Integrated Resort.’
Proceeds from the Rights Issue will be used to support JKH’s financing obligations, which increased due to higher-than-expected equity funding requirements for the Cinnamon Life project, delayed by postponed cash flow generation and gaming operations. JKH has secured a partnership with Melco Resorts and Entertainment Ltd., a leading global operator of casinos and integrated resorts. Melco has committed $125 million for outfitting and equipping the gaming space within the resort.
With the new casino licensing framework in place, JKH expects to commence gaming operations in phases, alongside the hotel, restaurant, and retail mall openings, with full project completion slated for mid-2025.