Agalawatte’s Rs.2.5 billion loan repayment for restructuring

The government is looking at restructuring the loans repayment for Agalawatte Plantations as it had obtained loans from 12 financial institutions upto a staggering Rs.2.5 billion with interest.

Agalawatte Plantations had obtained loans from DFCC, Hatton National Bank, the Bank of Ceylon, Sampath Bank, Commercial Bank, NDB, People’s Bank, State Bank of India, Softlogic Finance, Commercial Leasing and Finance, Alliance Finance and Lanka Orix.

These financial institutions were called for a meeting on Wednesday by Plantation Ministry authorities together with the owning company Browns PLC.

Authorities noted that they were looking at trying to restructure the loan repayment following negotiations on reducing the rate of interest originally agreed upon.

During the discussion it was proposed that Browns would immediately pay 25 per cent of the capital borrowed as a one off payment and the rest would be paid within five years in installments. But the financial institu- tions said they would submit their own counter proposals for a payment structure by April 6. Agalawatte Plantations previously run by Macwoods was said to have run into financial difficulty owing to banks and statutory dues. The loans with interest obtained from the 12 financial institutions amounted to Rs.2.5 billion. The liabilities were reported at Rs.4 billion as at 2016. At least one bank had recently already called for an auction of estates of the Agalawatte Plantations, which the authorities noted was not possible since it was state property.

It was also found out that Mackwoods had been making payments over a period of time but had stopped repaying the loans since two years ago.

Moreover, it was also found out that the balance sheet submitted to the Securities and Exchange Commission (SEC) as a result of which a re-audit of the accounts for 2014 were carried out by the same auditors, came out with a different picture.

Mackwoods were said to have used these for work on plantations, a museum, a tea centre and renovation of house and the construction of a helipad.