Business

Casino king Ravi Wijeratne’s plans to buy MTD Walkers abandoned

Ravi Wijeratne

Veteran casino operator Ravi Wijeratne’s plans to acquire cash-strapped construction company MTD Walkers PLC has officially been abandoned after the deal faced many challenges over a 5-month period.

MTD Walkers PLC said in a Colombo Stock Exchange (CSE) filing that it had been informed by its holding company MTD Capital Bhd that the latter would not pursue the transaction.

The official reason that had been provided in the disclosure is that there was “no positive development and/or progress on the transaction” since the deal was first announced to the CSE in September 2019.

This follows severe opposition to the transaction from creditors of MTD Walkers as its debts are yet to be settled. Chief among these were two enjoining orders obtained by Commercial Bank and People’s Bank preventing MTD Walkers from being taken over by Wijeratne.

These two separate orders enjoined MTD Walkers or MTD Capital Bhd from going through with the transaction or any similar transaction without approval by the two banks until all outstanding dues to the Banks were settled.

On 9th September 2019 MTD Walkers in a stock exchange filing said that Wijeratne had agreed to purchase a controlling stake of 90.78% of the company from its Malaysian parent MTD Capital Bhd. Wijeratne had  agreed to purchase 152,183,583 shares held by the the company’s parent through a voluntary offer to be made to all the shareholders of the company.

Wijeratne is the owner of Rank Holdings, which operates the popular Star Dust and Casino Marina casinos in Colombo and is also engaged in hydro and wind power generation, infrastructure and real estate development.

MTD Walkers has suffered heavily due to non-payment or delayed payment by the Government for state infrastructure projects carried out by the company, and is severely in debt.

Earlier this year MTD Walkers in a CSE corporate disclosure announced its intention to transfer its fully owned subsidiaries Walkers Shipyards Limited, Northern Power Company Ltd., and Colombo Fort Heritage Company Ltd., to its parent MTD Capital Berhad.

However, this too failed as several State and private banks, to which MTD Walkers owed billions of rupees, obtained Enjoining Orders against this transfer.