John Keells secures $175 mln from IFC to boost businesses in Maldives, Sri Lanka

John Keells Holding (JKH) has secured a $175 million investment from the International Finance Corporation (IFC) to fund planned expansion and refurbishment of the group’s hotels in Sri Lanka and the Maldives, and expand its supermarket chain in Sri Lanka.

The $175 million long term investment is IFC’s largest in Sri Lanka in 50 years of work in the country and will be the first supporting investments in the Maldives in a decade.

The move by the World Bank’s private sector arm is intended to provide JKH the flexibility and agility to fund its investments in an optimal manner, while providing additional support to the group’s liquidity position.

“I believe partnering with an internationally reputed financial institution such as IFC, particularly at this juncture of time, is a vote of confidence for JKH and the country, at large,” Krishan Balendra, Chairman and CEO of JKH, was quoted in a statement, as saying.

“Sri Lanka’s growth prospects in the medium to long-term remain positive and we are confident that, as always, we have the strength and resolve to keep moving forward with our investment pipeline despite the current period of unprecedented challenges where the outlook is now more positive.”

With tourism being a vital area for both Sri Lanka and Maldives, the investment will help create much needed direct and indirect jobs as well as generate considerable foreign exchange.

In addition, the investment will be used to support the group’s plans to open about 100 new supermarkets in Sri Lanka over the next three to five years, with a focus on less developed regions – a move that will benefit micro, small and medium sized enterprises as well as farmers who will become part of the supply chains to the new stores.

“IFC support will enable JKH, as one of the largest and most reputable businesses in Sri Lanka, to continue to invest, and ultimately create more jobs and work for small and medium sized businesses, despite the challenging economic headwinds and uncertainty over COVID-19,” Amena Arif, IFC Country Manager for Sri Lanka and the Maldives, said.

“It will also send a strong and positive message to the investor community that capital investments in Sri Lanka and Maldives are viable at this challenging time and are important to help the economies and the community to build resilience for the future.”

The investment, which is part of IFC’s broader efforts to create quality jobs in Sri Lanka and the Maldives, will also boost the supply of “green” hotels in the Maldives to meet growing demand.

JKH will adopt IFC’s green building standards – EDGE Buildings – for its newly refurbished hotels in the Maldives, aimed at providing a demonstration effect to other hotel operators.

In the Maldives, tourism has accounted for nearly three-quarters of the country’s total GDP, while in Sri Lanka, tourism was, prior to the pandemic, the third largest and fastest growing source of foreign currency in the country.

Sri Lankan conglomerate John Keells, under its Cinnamon Hotels & Resorts brand, runs four resorts in Maldives: Cinnamon Hakuraa Huraa, Cinnamon Dhonveli, Ellaidhoo Maldives by Cinnamon, and the recently-opened Cinnamon Velifushi Maldives.

Photo: Cinnamon Velifushi Maldives, the latest resort in Maldives by John Keells.

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