Six Senses Plans IPO in Colombo to Set up its Ops to Handle Resorts in the Region - Founder/CEO Sonu Shivdasani Reveals

08th May 2011, www.island.lk

Thai-based Six Senses & Spa hotels is planning a public float of shares (IPO) in the summer (June-August) in Colombo aimed at setting up its South Asian office to handle hotels and resorts in this region, according to its founder/CEO Sonu Shivdasani.

The energetic Indian-origin entrepreneur, told the Business Times in an interview in Colombo that all the company’s current four properties in the Maldives, Sri Lanka and India would be brought under this holding company to be based in Colombo.

“Peace has dawned on Sri Lanka and there are exciting times ahead,” he said on Friday as he enthusiatically explained the organisation’s current properties and plans in Asia and other parts of the world while grabbing a quick breakfast on the roof-top lounge of the Cinnamon Grand.

Mr Shivdasani and his wife -Eva, who together set up their first property in the Maldives in 1995, spend five months on an island in the Maldives and the rest in Thailand where the company – which has over 26 resorts across Asia and the rest of the world- is based.

The company has spas at Aitken Spence Group hotels in Kandalama and the Tea Factory and is setting up – as a joint venture - another resort adjoining Heritance Ahungalla which will have 54 villas and in the adjoining Madu Ganga island, 15 tents. “We want to create a low impact (on the environment) resort at Madu Ganga and replicate this elsewhere as a low-carbon (living-with-nature) unit,” he said.

The company is also looking at a site in Galle and contemplating a health resort either in the central hills or the Niligiri mountain in South India.

“Tourism will grow here because you have a tiny base,” he said.

Image: Sonu Shivdasani expressing a point. Pic by J. Weerasekera

Related Info :

• Six Senses to List Regional Business Unit on Colombo Stock Exchange. 30pct Stake Worth $30mn Offered via IPO

• Sixth Senses CEO Visits Sri Lanka on Joint Venture with Aitken Spence to Construct Upmarket Resort

• Six Senses Pulls Out of Dutch Bay Resort in Kalpitiya. Goes Ahead with Aitken Spence on a Project near Galle, Sri Lanka

• Sri Lanka Tourist Arrivals & Statistics

Six Senses to List Regional Business Unit on Colombo Stock Exchange. 30pct Stake Worth $30mn Offered via IPO

16th March 2011, www.ft.lk

In what is likely to be one of the biggest boosts to Sri Lanka’s investment profile globally, the world-renowned leisure brand Six Senses is to list its regional business unit on the Colombo Stock Exchange (CSE).

Six Senses, of top Thai hotelier of Indian origin Sonu Shivdasani, has two resorts in the Maldives whilst the first in Sri Lanka is under way in partnership with the Aitken Spence Group. The third resort in the Maldives is slated to open soon whilst the Six Senses brand is also being rolled out in India in addition to scouting for prospects in Nepal.

In a deal involving reverse acquisition, Six Senses is to make Sri Lanka its headquarters, owning and overseeing its leisure assets in the South Asia region.

Daily FT learns that the process for the listing of this entity is already underway.
According to market sources, a valuation of the business and the entity is pending but around 30% stake of the venture is expected to be offered via the IPO.

Some estimate the value of the IPO to be between US$ 30 and $ 40 million.
Analysts pointed out that the Colombo stock market remains attractive for issuers whilst the post-war boom in tourism and double digit growth forecast along with Sri Lanka positioning itself as a regional hub were other magnets for Six Senses.

When listed it will be the first of its kind on the Colombo bourse and analysts noted that success would provide an excellent window of opportunity for Sri Lanka to lure more international or regional companies to consider listing apart from setting up headquarters in Colombo.

Sonu, during a trip to Sri Lanka late last year, was quoted by local media as saying: “Over time tourism will become a dominant part of the economy in Sri Lanka, so it makes sense for us to operate in a country like that.”

“Since the return of peace I see Sri Lanka becoming an important regional hub,” he had told Lanka Business Online.

Six Senses is a resort and spa management and development company with properties in six countries including the Maldives, Thailand, Vietnam, Oman, Jordan and Spain.

Its properties in the Maldives are branded as Soneva by Six Senses with the two properties being Soneva Fushi, Maldives and Soneva Gili, Maldives, whilst the third one, Six Senses Laamu, will be opening next month. Six Senses Laamu is the only resort on the virtually uncharted Laamu Atoll, 150km from the equator.The other brand is Evason.

The Group has has seven resorts in Thailand, three in Vietnam, one each in Oman and Jordan, with another opening soon in Spain.

Sonu is also making his debut in India with spas, resorts and fine dining restaurants along with boutique hotels to tap high end travellers, according to Indian media reports.

The first Six Senses Spa across 7,000 sq mt will start functioning next month at the Jaypee Greens Golf and Spa Resort at Noida on the outskirts of Delhi.

The Six Senses Spa at Noida will occupy a three-story building.

Related Info :

• Thai Six Senses Spas makes Sri Lanka a Regional Hub to Manage Leisure Assets in Indian Ocean

• Six Senses Pulls Out of Dutch Bay Resort in Kalpitiya. Goes Ahead with Aitken Spence on a Project near Galle, Sri Lanka

Six Senses Pulls Out of Dutch Bay Resort in Kalpitiya. Goes Ahead with Aitken Spence on a Project near Galle, Sri Lanka

07th February 2011, www.lankabusinessonline.com

International luxury hotel chain Six Senses has pulled out of a deal to manage a resort being built on an islet off Sri Lanka's north-west coast, according to company officials.

The Dutch Bay Resort project, in Dutch Bay in Kalpitiya, was to have been a joint venture between Six Senses and Swarna Dweep, an investment vehicle set up by European investors and a Sri Lankan entrepreneur.

But Six Senses chief executive Sonu Shivdasani told hoteliermiddleeast.com that the 80-unit resort announced last year for Dutch Bay has been put on hold along with another project in Jordan.

He gave no details but officials with knowledge of the project say Six Senses has pulled out of the management deal.

There has been no word from Swarna Dweep or Sri Lankan tourism authorities about the deal.

The Dutch Bay project was estimated to cost 75 million dollars and consist of 60 mangrove chalets – two-storey villas with plunge pools – and 20 luxury villas on a lagoon.

The Six Senses decision was part of a revamp by the hotel chain in which it plans to establish up to 10 hotel clusters around the world, with between five and 10 resorts in each cluster with the aim of sharing best operational practices and staff.

But Shivdasani said that, as part of the south Asian cluster, Six Senses management was also looking at a resort on the Andaman Islands in the eastern Indian Ocean.

Shivdasani said another project with Sri Lanka's Aitken Spence group was going ahead near the southern town of Galle with accommodation in tents.

Related Info :
• Thai Six Senses Spas makes Sri Lanka a Regional Hub to Manage Leisure Assets in Indian Ocean

• Sixth Senses CEO Visits Sri Lanka on Joint Venture with Aitken Spence to Construct Upmarket Resort

• 6 Star Resort in Kalpitiya, Sri Lanka, Managed by Six Senses Chain. Swarna Dweep to Raise Funds through a Private Placement

Thai Six Senses Spas makes Sri Lanka a Regional Hub to Manage Leisure Assets in Indian Ocean

14th December 2010, www.lankabusinessonline.com

Thailand-based Six Senses Resorts and Spas is planning a regional headquarters in Sri Lanka's capital Colombo to own and manage up to 200 million dollars in leisure assets in the Indian Ocean, chairman Sonu Shivdasani said.

It is also building a 40 million dollar hotel with Sri Lanka's Aitken Spence group in the south western coast of the island.

A 30-year war ended in May 2009, and tourism arrivals to Sri Lanka are up 43 percent to October.

"Over time tourism will become a dominant part of the economy in Sri Lanka, so it makes sense for us to operate in a country like that," Shivdasani said.

"Since the return of peace I see Sri Lanka becoming an important regional hub."

He said the proximity to the Maldives where it now has three resorts, plans for projects in Andaman Islands in India and Mauritius made Colombo the obvious location to house the regional hub.

The Sri Lankan based unit will eventually own between 150-200 million dollars in equity in several projects in the Indian Ocean and also oversee resorts managed by Six Senses.

Shivdasani said the ready availability of accountants and legal services in Sri Lanka also helped in the decision to locate the regional headquarters to Colombo.

Sri Lanka's central bank recently relaxed exchange controls, which Governor Nivard Cabraal said will make it easier for international businesses to set up regional offices in the island.

Sri Lanka started a soft-pegged central bank in 1950 abolishing a currency board or hard peg which allowed free capital movement, low inflation and exchange rate stability.

But exchange controls were slapped within two years of starting a money printing central bank and the economy was progressively closed, until 1977, when economic freedoms of the people started to be restored partially.

Treasury secretary P B Jayasundera told a recent forum in Colombo that the island will have the best personal income regime in the region to encourage services sector talent.

Jayasundera said at least two major corporations which he did not name were interested in setting up regional offices in Colombo.

Officials say the end of a war in 2009 has made Sri Lanka among the safest locations in the world to locate firms.

The regional headquarters will oversee a 1,500 strong workforce. Many Sri Lankans already work in Maldivian resorts.

Shivdasani said tourism in Asia was picking up and his own group was expecting room revenue from hotels to grow 50 percent to 150 million US dollars this year while spas are expected to bring 25 million US dollars, up from 20 million last year.

Shivdasani said its high end 'Soneva' brand resorts in the Maldives yield an average of 1,000 dollars a room, while one exclusive villa is sold for 10,000 dollars a day.

In Sri Lanka it is building a 'Six Senses' brand resort which is priced around 400 US dollars a day.

Related Info:
Sixth Senses CEO Visits Sri Lanka on Joint Venture with Aitken Spence to Construct Upmarket Resort

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6 Star Resort in Kalpitiya, Sri Lanka, Managed by Six Senses Chain. Swarna Dweep to Raise Funds through a Private Placement

10th September 2009, www.lankabusinessonline.com

Developers of a luxury island resort managed by the Six Senses chain in Sri Lanka who have set up an investment fund will seek to raise further cash through a private share offering, an official said.

Neil De Silva, chairman of Dutch Bay Resorts which is to build the resort in north-western Kalpitiya, said investors can get returns from the first phase resort project as well as sale of luxury villas to wealthy clients in the second phase.

The resort project has been given a 15-year tax holiday from the Board of Investment and other incentives usually given to big projects by the investment promotion agency.

The six-star Dutch Bay Resort project, to be ready by 2011, is a joint venture between Six Senses and Swarna Dweep, an investment vehicle.

Swarna Dweep, set up by European investors and De Silva, a Sri Lankan entrepreneur, currently operating in Europe and the Middle East, has a 51 percent stake in Dutch Bay Resorts.

“Sri Lanka has been a missed opportunity,” De Silva said. “Now, with the war over, we’d like to better use this opportunity and bring in foreign friends and Sri Lankans overseas for equity investments.”

The island’s tourism sector is expected to boom with the end of the 30-year ethnic war in May when government forces defeated the Tamil Tiger rebels.

De Silva said he and his partners have already invested 36 million dollars in the project and seek to raise more funds through a private placement with other luxury property developments also planned.

“We will initially offer to friends and families and later call for public offers,” De Silva said.

“For Sri Lankan investors, the subscription amount is a minimum of 5,000 dollars.”

Investors can repatriate earnings which are tax free.

The investment, which will be locked in for a seven year construction and take-off period, is expected to generate a rate of return of 20-27 percent a year, de Silva said.

Earnings will be from operation of the Six Senes resort as well as sale of luxury villas.

The first phase of the project in Dutch Bay, off the north-west coast, will cost 75 million dollars and consists of 60 mangrove chalets – two-storey villas with plunge pools – and 20 luxury villas on the lagoon.

The second phase of the project, costing 100 million dollars, will consist of 80 villas, meant to be sold as luxury holiday or retirement homes to wealthy Arabs, Europeans and Sri Lankans.

Owners can lease them back to the developers.

“We can generate a high rate of return because we intend selling 80 homes, each with an acre of land, to the high-end market,” de Silva told LBO.

At current prices the villas are worth 2.4 to 2.7 million US dollars but prices are expected to rise when the resort starts operating.

The 9,000 square foot villas can also be rented for not less than 1,000 dollars a night.

Swarna Dweep is a Sri Lankan company established by Norwich International Consultants, a real estate business operating in the Kingdom of Bahrain since 1997.

According to its website, Swarna Dweep has been established to focus on development of tourism, real estate and transportation projects.

Kalpitiya - Related Links:

Tourism Development Project Kalpitiya from www.sltda.lk on Vimeo.

- Kalpitiya Integrated Resort Development Project (KITRP)

- Kalpitiya Interactive Map with Survey Maps of Dutch Bay and Portugal Bay Islands

- Kalpitiya Integrated Resort Development Project (KITRP) - Investment Opportunities

- Conceptual Development Plan - Kalpitiya Tourism Development Area (Ipantivu, Eranamutivu, Kakativu, Vellai I and Vellai ii)

- Strategic Environment Assessment Report - Kalpitiya Tourism Development Area

- Bar Reef - Wikipedia

- Dive the Bar Reef