RFP for sale of Colombo Hilton, Hyatt and Lanka Hospitals soon

Request for Proposal (RFP) to divest Colombo Hilton, Hyatt and Lanka Hospitals would be out shortly, said head of the State-Owned Enterprises (SOEs) Restructuring Committee Suresh Shah at a special media event held in Colombo yesterday.

Measures will be taken to restructure SriLankan Airlines, Sri Lanka Telecom, Waters Edge and Sri Lanka Insurance Corporation (SLIC) along with its subsidiaries. Transaction advises have already commenced work in this regard and the others would be done within the next five weeks. The final round of divestment is planned for the first quarter of 2024 and the others during the second quarter of 2024.

He said that they had to carefully study these institutions and clear some of the issues they face before divesting. “For example part of the land where the Hyatt is situated belongs to another and we are in the process of clearing this issue.”

He also said that the proceeds of these will be used to strengthen foreign exchange reserves of the country, strengthen the rupee and invest on more welfare projects for people. The urgency of restructuring the most fiscally significant State-Owned Enterprises (SOEs) was reiterated several times during the last 6 months.

“As committed to in the Interim Budget, a unit has now been established at the Ministry of Finance with the specific task of restructuring SOEs.”

The strategic interventions will be made to SOEs with the anticipation of achieving economies of scale and other benefits. He said that a total of 130 SOE’s came under their unit out of which 15 could be wounded. “Another 85 entities can go alone and would not need state patronage while the balance could remain under the state ownership.”

He also said that they have observed that some of the State institutions have been given a larger playing field against their competitors which is very unfair. “One such example is Sri Lanka Insurance Corporation where they are allowed to perform both life and General Insurance business under one umbrella while regulation does not allow private insurance companies to have both segments.”

He also said that Sri Lanka Petroleum Corporation, while being given a monopoly to sell jet fuel at a higher rate they were also given the option of borrowing from State banks, a privilege not given to the other private competitors. Sri Lanka Ports while being a maritime regulator are also engaged in business and this too is not ethical. “These are all set to change.” He also assured that though there was a lot of criticism that previously divested SOE’s had issues this time around several ‘international style check and balance systems are in place to maintain transparency.”We will also ensure that there will be no unsolicited proposals.”

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