In Sri Lanka’s stock market, ownership is not always power. Sometimes it is merely presence without control.
The evolving contest around Harischandra Mills PLC — now featuring Hayleys PLCholding roughly 40.6 per cent and Ambeon Capital moving decisively towards majority control — is a textbook case of how influence, timing, and governance collide on the Colombo Stock Exchange.
Hayleys entered the Harischandra story confidently. In late 2025, it acquired a substantial block at around Rs. 3,300 per share, becoming the single largest shareholder. The logic was clear: heritage brand, strong consumer recall, steady cash flows, and the possibility — eventually — of control.
What followed should have been routine. A mandatory offer was made. The market was invited to sell. The market declined. Almost entirely.
When Minority Shareholders Say “Not at That Price”
The near-total rejection of Hayleys’ mandatory offer was not an accident. It was a collective valuation judgement.
Minority shareholders signalled — unmistakably — that Harischandra was worth more than the price on the table.
Whether that belief was rooted in fundamentals, scarcity value, takeover anticipation, or simple conviction is almost beside the point.
What mattered was the message: control cannot be acquired cheaply just because the Code allows an offer.
This is where Sri Lanka’s takeover regime reveals its limits. It ensures process, not persuasion. A mandatory offer ticks
regulatory boxes, but it does not compel belief.
Hayleys complied. The market resisted.
Enter Ambeon — With a Different Playbook
Ambeon’s approach was structurally different. Rather than testing minority sentiment first, it moved to lock in a controlling block through negotiated purchases from existing shareholders. Control, not incremental accumulation, was the objective.
That shift altered everything.
Once 51 per cent is in sight, the narrative changes. Board appointments change. Strategic direction changes. Minority leverage changes. And large shareholders without control — however respected — find themselves in an awkward middle ground.
Which is exactly where Hayleys now sits. However, the accumulation of just under 10% will see Hayleys in the driving seat. It makes sense for the planned 100-strong islandwide supermarket chain where management control must be asserted to ensure trouble-free supply chain.
A Powerful Minority Is Still a Minority
At roughly 40 per cent, Hayleys remains influential but constrained. It can block special resolutions. It can demand explanations. It can negotiate.
But it cannot steer unilaterally.
This distinction matters because Sri Lanka’s listed companies are still deeply shaped by who controls the boardroom, not merely who holds shares. Strategy follows control. Capital allocation follows control. Culture follows control.
A large minority stake without alignment becomes leverage only if it is used deliberately — or traded wisely.
What This Says About the CSE
The Harischandra saga exposes several uncomfortable truths about Sri Lanka’s capital market:
First, control premiums remain decisive. Valuations leap not on earnings alone, but on the possibility of who will ultimately call the shots.
Second, minority shareholders are not as passive as they are often portrayed. When pricing feels wrong, they do not tender. That is a healthy signal — one regulators should notice.
Third, governance outcomes are negotiated, not guaranteed. Codes and disclosures matter, but power still flows from share blocks, not sentiments.
And What About Hayleys?
This is not a story of miscalculation. It is a story of market dynamics evolving faster than expectation. For Hayleys. The purchase was strategic – and historically, they are in almost always, for the long term.
Hayleys is not boxed in — yet. It retains optionality:
it can negotiate with the incoming controller,
it can assert governance standards from a position of strength,
or it can monetise its stake if valuations justify exit.
In Sri Lanka’s market, ownership matters — but control still decides the story.
