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Sri Lanka Equity Forum » Stock Market Talk » SAMP and VONE

SAMP and VONE

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1 SAMP and VONE on Wed Nov 30, 2016 7:08 am

glad


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics
Note 12 in the latest quarterly financial statement mentions that VONE has changed the SAMP status to 'available for sale'.  Can it be an indication that VONE will try to find a buyer and dispose SAMP if the price is right.
Anyone has any idea on this matter?

2 Re: SAMP and VONE on Wed Nov 30, 2016 7:21 am

EquityChamp

avatar
Moderator
@glad wrote:Note 12 in the latest quarterly financial statement mentions that VONE has changed the SAMP status to 'available for sale'.  Can it be an indication that VONE will try to find a buyer and dispose SAMP if the price is right.
Anyone has any idea on this matter?

You are correct. This classification enables VONE to dispose the investment in the open market.

3 Re: SAMP and VONE on Wed Nov 30, 2016 9:03 am

jayathu


Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
Are u crazy????they have to do it cause dammika perera whos the owner of the vone have to step down as the chairman of SAMP.

Dammika will never dispose SAMP stake.

4 Re: SAMP and VONE on Wed Nov 30, 2016 9:03 am

Yahapalanaya

avatar
Vice President - Equity Analytics
Vice President - Equity Analytics
Cannot expect capital gain on disposal of SAMP since it's cost 279/=.But DP may have some investment plan on cash generated from disposal(around 6Billion on current market price).He is master on that.

5 Re: SAMP and VONE on Wed Nov 30, 2016 9:08 am

jayathu


Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics

The Investment in Sampath Bank PLC of the group was accounted as equity accounted investee as per the provisions of LKAS 28 on the
following grounds where it demonstrated significant influence over the investee.
Vallibel One PLC is the single largest shareholder of Sampath Bank PLC owning 26,463,803 shares representing 14.95% of the
issued shares of the Bank.
Mr. Dhammika Perera who is the Chairman and Managing Director and the major shareholder of Vallibel One PLC, was the
Chairman of Sampath Bank PLC.
Mr. Dhammika Perera, also served as the Chairman of the Strategic Planning Committee of Sampath Bank PLC and a member of
the Nominations Committee of the Bank.
However, with effect from 31 July 2016, Mr. Dhammika Perera relinquished as Chairman of Sampath Bank PLC since he completed his
term of nine years as a Director. Consequently, the Board of directors of Vallibel One PLC decided that the existence of significant
influence over Sampath Bank PLC by Vallibel One PLC was no longer applicable as per the provisions of LKAS 28.Hence, the
Company discontinued the use of equity method of accounting and in terms of LKAS 39 decided to exercise the option to treat the
investment as being available for sale. Accordingly the effect of mark to market value of Rs.828 Mn as at 31st July 2016 and share of
profits of Rs.2,469 Mn which were recognized in previous years were reversed in this quarter’s statement of income.
The total Loss of Vallibel One PLC after considering the reclassification to Available For Sale financial Assets is Rs. 451 Mn. However
if the results of Sampath Bank PLC and the adjustments resulting from the reclassification is not considered, the Vallibel One PLC
would have earned a total profit of Rs.3,053Mn

6 Re: SAMP and VONE on Wed Nov 30, 2016 9:31 am

Yahapalanaya

avatar
Vice President - Equity Analytics
Vice President - Equity Analytics
@jayathu wrote:
The Investment in Sampath Bank PLC of the group was accounted as equity accounted investee as per the provisions of LKAS 28 on the
following grounds where it demonstrated significant influence over the investee.
Vallibel One PLC is the single largest shareholder of Sampath Bank PLC owning  26,463,803 shares representing 14.95% of the
issued shares of the Bank.
Mr. Dhammika Perera who is the Chairman and Managing Director and the major shareholder of Vallibel One PLC, was the
Chairman of Sampath Bank PLC.
Mr. Dhammika Perera, also served as the Chairman of the Strategic Planning Committee of Sampath Bank PLC and a member of
the Nominations Committee of the Bank.
However, with effect from 31 July 2016, Mr. Dhammika Perera relinquished as Chairman of Sampath Bank PLC since he completed his
term of nine years as a Director. Consequently, the Board of directors of Vallibel One PLC decided that the existence of significant
influence over Sampath Bank PLC by Vallibel One PLC was no longer applicable as per the provisions of LKAS 28.Hence, the
Company discontinued the use of equity method of accounting and in terms of LKAS 39 decided to exercise the option to treat the
investment as being available for sale. Accordingly the effect of mark to market value of Rs.828 Mn as at 31st July 2016 and share of
profits of Rs.2,469 Mn which were recognized in previous years were reversed in this quarter’s statement of income.
The total Loss of Vallibel One PLC after considering the reclassification to Available For Sale financial Assets is Rs. 451 Mn. However
if the results of Sampath Bank PLC and the adjustments resulting from the reclassification  is not considered, the Vallibel One PLC
would have earned a total profit of  Rs.3,053Mn
Correct.
26Million shares x -20(cost of share 279-market price 259)=loss 520M or 451M whichever

7 Re: SAMP and VONE on Wed Nov 30, 2016 2:00 pm

worthiness


Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
Changing to portfolio into investment available for sale leaves the option for VONE to get rid of their holdings with SAMP. This could happen at any time making the strength of SAMP upside down if deal is done at lower price.
So can we expect a forceful consequence to both VONE & SAMP? Is it the fact to slow down the share movement?

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