Ceylon Guardian Investment Trust PLC and Ceylon Investment PLC, two quoted investment holding vehicles of the Carson Cumberbatch group, last week announced that the Guardian group had secured cash surpluses of Rs.2 billion and capital gains through the sale of long-term holdings.

On Thursday, the Rubber Investment Trust Limited, a subsidiary of Guardian, sold its longstanding shareholding of three Malaysian oil palm companies to Goodhope Asia Holdings Limited, a Carson’s subsidiary based in Singapore.

These transactions on the trading floor of the Colombo Stock Exchange were valued at approximately Rs.731 million with Carsons Management Services (Pvt) Limited announcing that Good Hope had acquired 28.48% of the voting shares of Selinsing PLC boosting its holding in that company to 86.57%, a further 23.82% of Indo-Malay PLC to bring its holding there to 76.78% and 30.99% of Good Hope PLC giving 87.26% control of the company.

All these Colombo incorporated companies have valuable oil palm plantation holdings in Malaysia.

Carsons said that these divestments to a wholly owned subsidiary followed recent exits from Union Assurance, Ceylon Cold Stores and John Keells PLC held in Guardian’s long-term portfolio and these deals would realize profits estimated to top Rs.1.5 billion during the current financial year ending March 31, 2009.

"The trades would also contribute to enhancing the Guardian portfolio’s liquidity position to almost Rs.2 billion in cash surpluses and thereby give the investment group flexibility in evaluating the options available to it to either re-invest in tradable stocks or enhance direct returns to shareholders," Carsons Management Services said.

The managers said that the Guardian group, in addition to its extensive portfolio of general listed equity investments, also holds a part of the Carsons group’s strategic investments within its portfolio.

"These strategic investments have over a period of time accumulated significant value to the investment companies’ asset base and their shareholders," the managers explained.

"Thus, for the shareholders of Ceylon Guardian Investment Trust PLC and Ceylon Investments PLC, this sale would see the realization of value, booking of profits and securing of liquidity on these long time holdings in the oil palm companies."

They said that while realizing gains to the Guardian group, the divestment of these shares had enhanced the cash position of the Guardian portfolio giving the investment companies an opportunity to consider the best available option to utilize the cash generated in a manner beneficial to shareholders of the Guardian group.

Earlier this month, Goodhope Asia Holdings acquired the majority stake of the oil palm plantation companies from Carsons.The Managers explained that this strategy of a holding company in Singapore (Goodhope Asia Holdings) would enable the group to establish a stronger presence in the palm oil industry in its home base in South East Asia.

Malaysia, Indonesia and Singapore are the major players in the oil palm industry globally.

Carsons group currently has 80,000 ha. Of oil palms under cultivation and a palm oil processing capacity of 270 mt. per hour supported by infrastructure, logistics and supply chain management.

A business based in the region would permit Goodhope to source strategic partners, financiers, buyers and suppliers easily facilitating the rapid expansion of the company’s business base and links with industry groupings, the managers said.