Lanka Walltiles to raise Rs5bn via rights issue for debt reduction

Lanka Walltiles PLC has announced plans for a Rs5 billion rights issue as part of a strategic initiative to reduce its debt levels and integrate its plantation management arm into the main entity.

The rights offering will allow existing shareholders to purchase additional shares in proportion to their current holdings, providing the company with fresh capital to address its leverage position. Industry sources indicate the move aligns with the company's broader financial restructuring strategy aimed at improving operational efficiency.

The proposed absorption of the plantation management subsidiary is expected to streamline the group's organizational structure and enhance consolidated performance metrics. This integration is likely to simplify corporate governance and reduce administrative overheads across the group.

The exact timeline and terms of the rights issue are expected to be finalized following board and shareholder approvals. The development comes as Lanka Walltiles seeks to strengthen its financial position amid challenging economic conditions in the domestic market.

The company, which operates in the ceramics and building materials sector, will use proceeds from the capital raise to improve its debt-to-equity ratio and fund ongoing business operations.