Sri Lankaâ€™s MTD Walkers shifts subsidiaries to Malaysian parent to settle debt
ECONOMYNEXT – Sri Lanka’s MTD Walkers, which is carrying heavy losses, has transferred three subsidiaries including a shipyard, to its Malaysian parent for 19 million US dollars with a buy back deal, to help a subsidiary settle debt.
The group has transferred full ownership of Walkers Shipyard, Northern Power Company, and Colombo Fort Heritage Company to MTD Capital Berhad, a stock exchange filing said.
MTD Capital Berhad, an investment holding company with interest from civil engineering and real estate to energy, ports, and manufacturing of construction related materials, owns 90.78 percent of MTD Walkers, a construction group.
The aim of the deal is to help MTD Walkers settle an outstanding loan of 19 million US dollars payable by its subsidiary CML-MTD Joint Venture Ltd. to Export-Import Bank of Malaysia
Berhad as part of a group restructuring.
The stock exchange filing said MTD Walkers has the option to buy back the shares in its three subsidiaries for the same amount under a call option agreement with the Malaysian parent firm.
MTD Walkers said the transfer took place on January 11, 2019 and was not prejudicial to the interests of minority shareholders.
On January 17, the company told the stock exchange, in response to a query, that it had not engaged in any undisclosed price sensitive business activities or transactions to raise its share price and that it was unware of the reason for the increase in its share price.