Blue Diamonds to call EGM to use Right Issue to pay salaries

Dec 04, 2015 (LBO) – Sri Lanka’s Blue Diamonds is to call an Extraordinary General Meeting to obtain approval to use part of their Rights Issue funds to pay staff salaries. In a stock exchange filing the company that exports diamond studded gold jewellery said some major shareholders agreed to allocate funds for working capital requirements including salaries and welfare, factory maintenance, electricity, water and to clear bank draft. Objectives of the Rights Issue were establishment of Rs50mn R&D Unit, establishment of Rs30mn Global Design Centre, Rs50mn investment in new machinery, Rs30mn for International Trade Fair and Rs89mn investment in inventory. So far the company has utilized 55 million rupees for the above objectives. “However Rs.33mn of the Rights Issue proceeds had been so far utilized for working capital requirement and a further Rs.26mn will be required for future,” the company said. “Of the balance Rs.50mn, Rs.12mn will be utilized for International Trade Fair participation and Rs.38mn will be utilized for Investment in inventory.” Even though the company initially not intended to provide funds for salaries, during the past month the board of directors has realized the issue, Blue Diamonds further said.