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RIL Property's IPO oversubscribed

RIL Property Ltd.'s IPO of 120 million shares opened at the Colombo Stock Exchange April 4 and was oversubscribed at an issue price of 8 Sri Lanka rupees per share.

The owner and operator of commercial office space in Colombo, Sri Lanka, was looking to raise 960 million rupees from a fully subscribed offering. Subscription list of the new shares is expected to close April 26 and the shares have received approval to be listed on the exchange.

According to an IPO prospectus, the funds will be initially used to refurbish the company's READYWEAR building in Colombo, which is expected to cost 694.1 million rupees. The refurbishment is anticipated to be completed in June 2018 and it will add 13,335 square feet of leasable space to the existing 45,897 square feet at the building.

Additionally, the funds raised are expected to be utilized for the expansion of RIL Property's fully owned subsidiary, FoodBuzz Pvt. Ltd., which operates a chain of Singapore-based BreadTalk. The 11-outlet expansion of FoodBuzz is estimated to cost 550 million rupees over the next five years.

Cornerstone investor NDB Capital Holdings Ltd. has committed to subscribe for up to 25 million shares amounting to 200 million rupees. In case of undersubscription, the underwriter, Commercial Bank of Ceylon PLC was required to subscribe to a maximum of 37.5 million shares amounting to 300 million rupees.

Commercial Bank of Ceylon PLC is the lead manager and the underwriter, while NDB Investment Bank Ltd. is the joint manager of the offering.

As of April 3, US$1 was equivalent to 151.99 Sri Lanka rupees.