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The Stock Market identified as a willing and able source to fund digital transformation

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The Federation of Information Technology Industry Sri Lanka (FITIS), the Colombo Stock Exchange (CSE) and the Information and Communication Technology Agency (ICTA) recently conducted a webinar titled “Financing Digital Transformation: Is Going Public the Next Step?”, focusing on how companies in the IT industry can now consider a stock exchange listing in view of the recent changes to CSE listing eligibility.

The discussion focused on the expansion of the eligibility criteria for an initial listing of shares on the Main Board and the Diri Savi Board which will now enable a wider spectrum of companies to qualify for a listing.

The webinar featured capital market and tech industry experts including Chairman of FITIS Abbas Kamrudeen, Director/legal Adviser of ICTA Jayantha Fernando, CSE CEO Rajeeva Bandaranaike, CSE Chief Regulatory Officer Renuke Wijayawardhane and Founder/CEO of Pickme Jiffry Zulfer.

Director/Legal Adviser of ICTA Jayantha Fernando said that global success stories have helped catalyze a shift among private-company leadership toward viewing public markets as a more welcoming place to raise capital.

The stock market engine should be recognized as a tool within this ecosystem which, if correctly used, could pave the way for not only companies to grow but for the economy at large to grow as well, he noted.

Sharing his thoughts at the webinar, the Chairman of FITIS Abbas Kamrudeen said, “When it comes to financing, there are many options companies can evaluate from bootstrapping, Angel investors, debt capital, Venture Capital to private equity. But my belief is that for those companies that have matured to some extent, there is no better option to financing than going public. The reason being, it not only gives you flexibility and speed in future rounds of financing, but it will also allow you to understand the true value of your organization.”

The CEO of CSE Rajeeva Bandaranaike shared the perspective on the rationale for the CSE to revamp its listing requirements to cater to an ever-evolving business landscape in Sri Lanka consisting of modern and dynamic business models, which are particularly seen in the technology space.

He outlined that these new changes are now well placed to attract a wave of tech companies to the local stock market.

The Chief Regulatory Officer of CSE Renuke Wijayawardhane, highlighting these new avenues for companies stated, “Companies that ideally could not look at a listing on the main board as a result of the three consecutive year profit requirement now have other options. Companies with positive net assets for two financial years could list on the CSE with an aggregate net profit after tax for three years, an alternate which does not require companies to be profitable for three consecutive years.”

He added: “To broaden the entry routes, we have also introduced revenue and cashflow options in addition to the two profit-based routes. Companies could now demonstrate either an aggregate revenue of Rs. 3 billion for three financial years or positive operating cashflow after adjusting for working capital for two consecutive years. The revenue and cashflow route could be explored by companies capable of demonstrating a market capitalization of Rs. 5 Billion or more at the point of listing.”

Companies have also been given the opportunity of listing on the Diri Savi Board by demonstrating a revenue of Rs. 350 million for the financial year immediately preceding the date of the initial listing application and a market capitalization of Rs. 2 billion at the point of listing”, he added.

Speaking from an Investment Bank’s perspective, Head – Corporate Advisory at NDB Investment Bank, Nilendra Weerasinghe noted the progressive steps taken by the CSE to encourage tech companies to raise capital in the public markets.

“We need more private capital flows to support SMEs and startups to make it to the big league. In doing this, policies which incentivize private capital investments into angel and venture capital fund like structures could catalyze this space having a significant impact on the broader economy”, he further said.

Renowned tech entrepreneur and CEO of Pickme Jiffry Zulfer identified the stock market listing as an ideal exit option for investors and private equity firms investing in start-ups.

He went on to note that having the stock market listing as an option and a possible exit mechanism will help the growth of the start-up ecosystem in Sri Lanka by attracting a wider audience of investors who see the value of a market-based exit mechanism.

Companies are invited to connect with the CSE to discuss how they can now tap into public funding to spur on the company’s growth agenda. Details on eligibility of listing and the process could also be obtained through www.cse.lk or by sending an email to maalik@cse.lk


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AG not bound by its recommendations, yet to receive report

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PCoI on Easter Sunday attacks:

By Shamindra Ferdinando

Attorney General Dappula de Livera, PC is not bound by recommendations made by the Presidential Commission of Inquiry (P CoI) into the 2019 Easter Sunday carnage, or presidential directives in that regard, according to authoritative sources.

They said that the AG couldn’t under any circumstances initiate legal proceedings until he had received the full PCoI report.

President Gotabaya Rajapaksa received the PCoI report on Feb 1. The President’s Office delivered a set of PCoI reports to Speaker Mahinda Yapa Abeywardena on Feb 23, a day after the report was presented to the cabinet of ministers. The Island raised the matter with relevant authorities in the wake of a section of the media reporting the PCoI recommending punitive measures against former President Maithripala Sirisena, Defence Secretary Hemasiri Fernando, IGP Pujitha Jayasundera, Chief of State Intelligence Senior DIG Nilantha Jayawardena, Chief of National Intelligence retired DIG Sisira Mendis and All Ceylon Makkal Congress (ACMC) leader and Samagi Jana Balavegaya MP Rishad Bathiudeen et al over the Easter Sunday carnage.

Sources pointed out that due to the inordinate delay in sharing the PCoI report with the AG, the department hadn’t been able to take preliminary measures required to initiate the proceedings. Sources said that a team of officers would take at least six weeks or more to examine the report before tangible measures could be taken.

With the AG scheduled to retire on May 24, 2021, even if the AG Department received the P CoI it would be quite a tough task to initiate proceedings ahead of retirement, sources said. However, in terms of the 20th Amendment to the Constitution enacted in last October, both the AG and the IGP could receive extensions beyond 60 at the President’s discretion.

 

Dappula de Livera received an Acting appointment as the AG a week after the Easter Sunday carnage whereas his predecessor Jayantha Jayasuriya, PC, was elevated to Chief Justice.

Responding to another query, sources said that the Attorney General two weeks ago requested Secretary to the President for a copy of the P CoI. However, the AG was yet to receive one, sources said. In spite of the AG not receiving a P CoI copy, the AG had instructed the IGP to obtain a copy of the report when he requested the police to complete investigations into the Easter Sunday carnage. The AG issued specific instructions after having examined police files pertaining to the investigations.

The IGP, too, hadn’t received a copy so far though some sections of the report were in the public domain.

Agriculture Minister Mahindananda Aluthgamage displayed at a live political programme on Derana a copy of the P CoI report he received at the cabinet meeting earlier in the day.

Sources said that the Attorney General’s Department couldn’t decide on a course of action in respect of the Easter carnage on the basis of a section of the report. In terms of the Commission of Inquiry Act (Section 24), the AG enjoyed significant powers/authority in respect of investigations; sources said adding that the Department urgently required both the P CoI report and police investigations report. The Attorney General’s Department has raised the delay in receiving a P CoI report amidst the Catholic Church attacking the government over the same issue.

Sources said that ministerial committee appointed to study the P CoI report couldn’t decide on how to proceed with the recommendations and the matter was entirely in the hands of the AG. Sources pointed out that the delay on the part of the government to release the report had received the attention of sections of the international media, including the New York Times. Public Security Minister retired Rear Admiral Sarath Weerasekera having met Malcolm Cardinal Ranjith at the Bishop’s House on Dec 8, 2020 said that the AG would get a copy of the P CoI report once the President received it. Minister Weerasekera said that the CID had handed over the relevant files after having completed investigations into eight blasts. Referring to the Parliamentary Select Committee (PSC) report on the Easter Sunday carnage, the former Navy Chief of Staff said that all such documents would have to be brought to one place and considered before initiating legal proceedings. Acknowledging that there could be delays, lawmaker Weerasekera said that on the instructions of the Attorney General a 12-member team of lawyers was working on the case. The minister vowed to expose the mastermind behind the Easter Sunday attacks. Investigations continued while some of those wanted were overseas, the minister said.

The minister acknowledged that the Attorney General couldn’t proceed without the P CoI report. Minister Weerasekera reiterated that once the President received the P CoI report, it would be sent to the Attorney General. The minister said that there were documents two to three feet high that needed scrutiny. The minister assured comprehensive investigation. The minister said that investigations pertaining to eight blasts had been completed and the reports handed over to the AG. However, the Attorney General had found shortcomings in those investigations.

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JVP picks holes in PCoI report

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By Saman Indrajith

The Presidential Commission of Inquiry on the Easter Sunday bombings had failed to identify the mastermind of , the JVP said yesterday.

Addressing the media at the party headquarters in Pelawatte, JVP Propaganda Secretary MP Vijitha Herath said that the PCoI report had levelled accusations against former President Maithripala Sirisena, former IGP and head of intelligence for their dereliction of duty, shirking of responsibilities and not taking action to prevent the attacks and negligence. There were reference to the causes of the terror attacks and actions to be taken to avoid such attacks and the influence of extremist organisations. “However, there is no mention of the mastermind of the attacks, the handlers of the attackers and those whose interests the carnage served. It is also not mentioned whether there has been any foreign or local organisation behind those attacks. As per the PCoI report the attack took place as a result of culmination of extremism.

“According to the PCoI the extremist activities were a result of the prevailing political situation then. The entire nation was waiting to see who was responsible and who masterminded those attacks. The PCoI has failed to identify the true culprits responsible for the terror attacks. The report says that the leader of the suicide cadres killed himself in the attacks and it was a puzzle. That means those who are actually responsible for the attacks are still at large. The report does not provide exact details of the sources of the attacks. The PCoI had sittings for one year and five months. It summoned various persons and got their statements but it has failed to shed any light on the terror attacks. Everybody knows that the top leaders of the government and heads of security and intelligence establishments failed in their duties. Ranil Wickremesinghe was the second in command and he too is bound by the responsibility but the PCoI report fails to identify him as one of the persons against whom legal action should be instituted. The PCoI has treated Wickremesinghe and former President Maithripala Sirisena differently. We are not telling that this report is a total failure but we cannot accept this as a complete report. The PCoI handed over its report to the President on Feb 1. After 23 days it was sent to Parliament. Now, a copy of the report is there in the parliamentary library for the perusal of MPs.”

Herath said that the PCoI did not have powers to take punitive action. “It only has powers to name those responsible and recommend action to be taken against those named.

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TNA MP faults govt. for delay in answering questions, gets under Johnston’s skin

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By Saman Indrajith

It did not matter whether the MPs were wearing pressed clothes or had travelled long distances when their questions were answered, Chief Government Whip Johnston Fernando told Parliament yesterday.

 The Minister said so in response to a complaint by Batticaloa District TNA MP Shanikyan Rasamanikkam, who expressed his dismay for government taking time to answer a question raised by him.

 MP Rasamanikkam has raised a question whether the Minister of Health is aware that the Dikkodai ospital, located in the Batticaloa district is not used for public purposes and the patients who visit the hospital for receiving services, face inconveniences, owing to that. On behalf of the Minister of Health, the Chief Government Whip and Minister asked for additional two weeks time.

 MP Rasamanikkam: I come to parliament from Batticaloa, which is 422 km away. To attend Parliament we take great care including pressing our clothes. After taking so much trouble to come there braving the pandemic threat we do not get answers. There is a Health Minister and Acting Health Minister and neither of them is here. I saw Minister Dr Sudarshini Fernandopulle in the House this morning. She too has gone out. I travel more than 800 km. We could attend to many other problems. It is because the government does not give answers we are conducting protest marches, but when we do so we are hauled up before courts.

Chief Government Whip Minister Johnston Fernando: Every MP comes here wearing pressed clothes. But that has nothing to do with questions and answers here. I have been requested by the subject minister to ask for two weeks’ time. The MPs have a right to ask questions and in the same way the ministers have the right to ask for time. On the other hand, whether you cover 400 km to reach parliament does not matter. The majority of MPs travel 200 to 250 kilometers to come to Parliament. It is for that purpose they contest elections and get elected. Once elected the distance is not an issue you have to come to Parliament. The government has answered all your questions. This is the first time the Minister has asked for additional time. It is unfair for you to level charges. A more responsible conduct is expected of you as an upcoming political leader.

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