MTD Walkers not clear how it will find funds to meet payout

Troubled MTD Walkers PLC suffered a fresh blow this week after the Supreme Court ordered its subsidiary, Northern Power Company (Pvt) Ltd, to release Rs 20mn to residents affected by groundwater and soil contamination caused by discharge from its power plant in Chunnakam, Jaffna.

It is not immediately clear how the company will find funds to meet the payout. Its Malaysia stakeholder is yet to sell its 90.8 percent controlling stake in the company to Sri Lanka’s Anunine Holdings. And its share has been suspended from trading since February this year.

To make matters worse, the last Malaysian director of MTD Walkers left the country in December 2018. The management now has to send cheques to Malaysia to be signed but often do not receive a response for ten days, sometimes a fortnight. The company seal is locked up.

The monies can be generated internally to remunerate staff, an authoritative source said. But the lack of response from the Malaysians holds payments up for weeks. “We did not start defaulting on anything till the middle of last year,” the source said. “Now, we are struggling with the Malaysians. They don’t reply to an email or any mode of communication, including phone calls.”

Board resolutions have to be signed,” he continued. “The only person who was here to sign cheques left on December 18. The local management is fighting a huge battle.”