Vanik awaits Court of Appeal order to restructure

Hiran H.Senewiratne

Vanik Incorporation PLC is awaiting the Court of Appeal judgement to go ahead with its restructuring plan, which was approved by majority stakeholders and shareholders of the company, its Chief Executive Officer (CEO), Justin Meegoda said.

He said the recent District Court Judgement gave a decision to wind up the company without considering the restructuring plan. At present trading in the Colombo Stock Market is also suspended due to this issue.

Meegoda said the District Court gave the winding order, when more than 75 creditors and 75 shareholders gave the green light for the restructuring process of the company. This winding case came into the forefront in 2002 by the Public Bank but later they withdrew and other banks including Seylan Bank, Ruhunu Development Bank, HSBC (Trustee) and People’s Bank got into their shoes eventually.”

However, the company has appealed before the Appeal Court following the District Court order, which is expected to be taken up either this week or next week. Therefore, all the functions of the Board is disoperative until the Appeal Court decision,” Meegoda said.

Meegoda said that once the Court decision is delivered, then only can the winding order be set aside to go ahead with their proposed major restructuring process.

At present the company is not going for major activities but are doing certain operations like fee based merchant activities, insurance brokering for subsidiaries, IT and Tourism in order to keep the company running, Meegoda said.

The company’s major investor/shareholder Capital Reach, is expected to go for a debenture issue soon.