Japan’s Onomichi Dockyard Limited, the majority shareholder of Sri Lanka’s flagship shipbuilding company, Colombo Dockyard PLC, has announced its decision to exit the company’s management after over three decades. Holding a 51% stake, Onomichi’s withdrawal comes amid the company’s ongoing financial struggles.
As part of this transition, Onomichi’s representatives on the board—T. Nakabe, K. Kobatake, and J. Furukawa—resigned on December 6, 2024. Additionally, long-serving director L. Ganlath has been appointed as the Non-Executive Chairman to lead the company during this critical period.
Colombo Dockyard is grappling with its worst financial performance in its 50-year history, recording an unprecedented loss of 11 billion Sri Lankan rupees in 2023. However, despite these challenges, the company managed to increase its export revenue by 36% during the first nine months of 2024 compared to the same period in the previous year.
In a disclosure, the company expressed confidence in overcoming the crisis, citing the continued support and cooperation of its stakeholders. The statement also confirmed that Onomichi is open to selling its stake, paving the way for new investors to join the company.
Colombo Dockyard has already updated its key creditors about Onomichi’s planned exit and reassured them of its commitment to continue operations under a new partnership. Creditors have responded positively, pledging their support to the company’s efforts.
The board has cautioned investors against speculation regarding the company’s shares, emphasizing that discussions with potential investors are still in the preliminary stages. “There is no certainty yet about the finalization of a new investor or the terms of such engagement,” the disclosure noted.
This strategic move marks a turning point for Colombo Dockyard, as it seeks to stabilize its operations and regain financial health under new leadership and potential partnerships.
