Court dismisses contentious GL business rehabilitation plan
A business rehabilitation plan for Group Lease Plc (GL) filed by J Trust Asia Pte Ltd (JTA) has been dismissed by the Central Bankruptcy Court on grounds that GL is not insolvent and has never defaulted on its debt repayment.
In a statement, GL said Kasikornbank, a major creditor of GL, had also objected to the business rehabilitation plan as the company does not need it, adding there is a conflict of interest between JTA and the company.
“The fact that JTA submitted a case to the Civil Court on Jan 9 and submitted a petition for business rehabilitation to the Central Bankruptcy Court on Jan 10, only one day apart, without waiting for the
Civil Court’s decision, is considered to be an unreasonable rushing of the process,” said the statement.
Earlier,JTAi ni tiated legal proceedings against Group Lease Holdings
Pte Ltd (GLH), GL’s whollyowned subsidiary registered in Singapore, and other companies, based on the allegation that GLH and other defendants had defrauded JTA to invest in GL for US$180 million (5.62 billion baht).
GL is considering whether to file a lawsuit against JTA, which was the company’s strategic partner and creditor for international customer loans in Singapore and other countries, said f ormer GL director and chief executive Tatsuya Konoshita.
Mr Konoshita said t he news about JTA’s legal proceedings against GL have been broadcast across numerous media outlets, resulting in damages to the company in terms of business opportunities.
He said that GL remains financially secure. As of the end of 2017, the company’s total assets stood at 14.38 billion baht, with total share-to-equity at 5.72 million and total liabilities at 685 million.
GL has cash on hand of 3 billion baht. “The company still has a strong financial status and has normal business operations. We don’t understand why JTA wanted GL to be in a rehabilitation programme and we are considering suing JTA as a result of this damage,” said Mr Konoshita.
GL last year set a full asset impairment of 2.5 billion baht to cover all transactions for the company’s global businesses, including Singapore and Cyprus, said Mr Konoshita.
This caused the company to record a net loss of 1.82 billion baht compared with net profit of 1 billion in 2016, he said.
GL’s consolidated bad debts and doubtful accounts increased by 9.77 million baht or 3.1% year-on-year, mainly because of a 11.3% hike in portfolios.
GL’s share price has fallen drastically amid the ongoing regulatory scandal. GL is a digital finance company specialising in hire purchase for Japanese motorcycle brands.
On Oct 16, the Securities and Exchange Commission filed a criminal complaint against former chief executive Mitsuji Konoshita, alleging fraud, misappropriation of company assets and falsification of accounting records by executing concealed transactions through several associated companies abroad to exaggerate the company’s operating results.
In February, GL appointed Skol Harnsuthivarin as the new chairman to replace Mitsuji Konoshita as the latter had resigned from his position.
The company expects to record a 10% revenue growth this year.
GL shares closed yesterday on the Stock Exchange of Thailand at 9.20 baht, an increase of 1.20 baht, in trade worth 320 million baht.