LRI acquires 71% stake in Lee Hedges in a landmark Rs.3.93 billion deal that reshapes Colombo’s commercial property sector. The acquisition, completed alongside Mauritius-based Eighth Wonder, positions LRI as a leading investor in high-yield urban assets.
Sri Lanka’s LRI acquires 71% stake in Lee Hedges, reshaping Colombo’s commercial real estate
On January 8, 2026, Lanka Realty Investments PLC (LRI) and Mauritius-based Eighth Wonder completed the acquisition of a combined 71 percent stake in Lee Hedges PLC, a transaction valued at approximately Rs.3.93 billion. The move signals a significant shift for LRI, which is transitioning from a passive land-banking strategy to owning high-performing, income-generating commercial properties in Colombo.
Under the terms of the deal, LRI purchased a controlling 51 percent stake, amounting to 13,057,595 ordinary voting shares at Rs.216.00 per share. Eighth Wonder, a long-standing strategic partner and foreign institutional investor, acquired 20.1 percent, comprising 5,148,684 shares, also at Rs.216.00 per share.
Lee Hedges PLC controls prime commercial real estate in Colombo 3, including the notable property at 353 Kollupitiya Road. Analysts view the acquisition as a strategic effort by LRI to consolidate its presence in the capital’s commercial sector, building a resilient asset portfolio that can weather economic fluctuations while benefiting from long-term land appreciation.
Eighth Wonder’s involvement reinforces foreign confidence in Sri Lanka’s real estate market. The Mauritius-registered investment vehicle has consistently collaborated with LRI, and this joint acquisition highlights the appeal of Sri Lanka’s urban property sector to international institutional capital.
The transaction also facilitated the exit of Lee Hedges’ major shareholders. LRI acquired its stake from Lee Hedges & Company Limited, previously holding 51 percent of the company. Eighth Wonder purchased its block from Pioneer Homes (Private) Limited, the second-largest shareholder, which held just over 20 percent.
Because LRI’s holding exceeds the 30 percent regulatory threshold, the deal activates the Takeovers and Mergers Code. As a result, LRI is obliged to extend a mandatory offer to minority shareholders, expected to match the transaction price of Rs.216.00 per share. This move ensures transparency and compliance with Sri Lanka’s corporate acquisition framework.
Financially, the deal reflects a slight discount to book value. According to interim statements ending September 30, 2025, the net asset value per share for the Lee Hedges group stood at Rs.242.66, making the acquisition price of Rs.216.00 approximately 11 percent lower than the book value. Market reactions were immediate: Lee Hedges shares closed the week down Rs.12.25, or 4.82 percent, settling at Rs.241.75 from the previous close of Rs.254.00.
Industry experts suggest that the acquisition strengthens LRI’s positioning in Colombo’s competitive real estate market, particularly in the premium commercial segment. By leveraging high-value urban properties, the company can generate consistent rental income while capitalizing on the long-term growth potential of the capital’s prime districts.
Furthermore, the collaboration between LRI and Eighth Wonder demonstrates a blend of local knowledge and international investment expertise. With LRI’s operational insight and Eighth Wonder’s financial support, the partnership is expected to enhance the management of acquired assets, ensure operational efficiency, and maximize returns.
This acquisition also sets the stage for future real estate consolidation in Sri Lanka. Analysts predict that similar strategic moves may follow, as companies seek to optimize portfolios, attract foreign investment, and respond to evolving market dynamics. LRI’s proactive approach underscores the potential for robust commercial property development in Colombo, reinforcing confidence in the sector’s long-term prospects.
In summary, the acquisition of Lee Hedges represents a strategic pivot for LRI, a testament to its vision of shifting from passive land banking to active, high-yielding commercial investments. The Rs.3.93 billion transaction, executed in partnership with Eighth Wonder, marks a defining moment for Colombo’s commercial real estate landscape and reinforces foreign investor confidence in Sri Lanka’s urban property market.