Ninety percent shareholders give consent:

People’s Leasing takes over SML management

Hiran H. Senewiratne

Seylan Merchant Leasing (SML), a subsidiary of Seylan Merchant Banks will transfer 20 million of its shares to People’s Leasing Bank following the Extraordinary General Meeting (EGM), sources said. SML, a listed leasing company in the Colombo Stock Exchange (CSE) held an EGM to enlighten shareholders and 90 percent of them gave their consent for the company to go ahead with the People’s Leasing move, said its Deputy Chairman Rohan Senanayake. The EGM was held under the new Companies Act.

Currently, the People’s Leasing Bank is conducting a due diligence on the entity to purchase 70 percent of the entire shareholding or 20 million shares of the company to overcome the current crisis, sources said.

However, market sources said the net capital of SML is below the asset base and the company is planning to dispose some of its properties before the Central Bank intervenes and the company has asked some employees to lay off its positions.

Senanayake said that they will not retrench any employees in the entity and its commercial operations are going ahead as usual.

Assistant Commissioner (Industrial) Ms C. Waniganayake said some employees at Seylan Merchant Leasing have complained against the company’s failure to pay last month’s salaries and she has sent a representative to look into the matter.

A spokesman for the Central Bank, Non Bank Supervision Department said People’s Leasing will take over the management and not a single employee had been asked to leave Seylan Merchant Bank.

These issues arose following the Golden Key crisis in the Ceylinco Group a few months ago.

SML has 13 branches and 12 windows and its parent company is Seylan Bank of Ceylinco Group of Companies. Seylan Bank owns 52 percent of shares of Seylan Merchant Bank.