Financial Times

Meegoda to meet debenture holders amid asset transfer charges
Justin Meegoda, CEO of Vanik Incorporated Limited, is to meet representatives of its 11,000 debenture holders on Wednesday over non-payment of interest amid fears the company is transferring some of its valuable assets.

Responding to allegations by debenture holders on non-payment of interest due for October 2004, Meegoda said that there was a certain amount outstanding which they will hope to resolve at the meeting.

Vanik has informed the CSE that it is unable to pay the interest instalment to its debenture holders. Secretarius (Pvt.) Limited, the trustees who represent the debenture holders, have requested the Colombo Stock Exchange to ensue that Vanik abides by its obligations to the debenture holders.

The debenture holders further allege that Vanik Incorporated is in the process of transferring assets with value, such as shares of its subsidiaries, Vanik Leasing and Vanik Factoring, to new financial institutions.

Meegoda emphatically denied these allegations saying that Vanik was currently in a process of restructuring to attract new investors. "No, Vanik has not been transferring assets to new financial institutions, we are only restructuring our operations," he said.

He said that Vanik was currently in the process of negotiating with new investors so as to revitalise the company. "Up to now we have been unsuccessful in coming to an agreement, but we will continue to carry on negotiations," he said. He also said that once the negotiations are finalised he will be making a statement to that effect with the names of the investors.

He further said that at a meeting held for debenture holders some weeks ago, only nine out of the 11,000 debenture holders had attended. "These allegations are being made by a few trouble-makers who want to sabotage the negotiations that Vanik is currently involved in," he said.

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