PTL CEO Kasun Palisena yesterday said that Perpetual Asset Management paid Rs. 348 million dividends to Perpetual Capital Holding owned by Geoffrey Aloysius (father) and Arjun Aloysius (son) in November 2016. When Justice Prasanna Jayawardena questioned the witness about it, he said that he was unaware as to what happened to that money afterwards.
On being questioned by the Commission as to what happened to Rs. 712 million dividends paid by PTL to its 100% shareholding company, Perpetual Asset Management Pvt Ltd (PAM), the witness yesterday explained how the dividends have been distributed during the time period after he was appointed as a non executive director of PAM in February 2016.
President’s Counsel Kalinga Indatissa appearing on behalf of Palisena yesterday led the evidence in relation to the questions raised earlier by the Commission.
The Witness said he first joined PTL in November 2013 as the chief dealer and later in January, 2015 was appointed as the CEO of PTL. Then, he was appointed as a non executive director to the Board of Directors at Perpetual Asset Management (PAM), which is the 100% shareholding company of PTL in February 2016.
The witness said that he has no relationship with Perpetual Capital Holdings, which owns Perpetual Asset Management.
When Justice Prasanna Jayawardena questioned, the witness said he was aware about two dividends payments from PTL to its 100% share holder, Perpetual Asset Management after he became a non executive director of PAM in February 2016.
According to the witness, Rs.90.09 million dividends on August 8, 2016 and another Rs. 348.255 million dividends on September 19, 2016 had been paid from PTL to PAM during his tenure as a director of PAM (total of Rs. 458.548 million).
The witness said only about the dividends paid during the time after he was appointed as a director of PAM. There were dividends declarations submitted earlier by PTL before the Commission with regard to previous years as well.
However, when the Commission questioned as to how PAM spent the given dividend in 2016, the witness said as a non executive director of PAM he was aware that Rs. 642.69 million dividends was invested to buy voting shares of NDB, Central Finance and Lanka Ashok Leyland through PAM’s subsidiary company called Perpetual Equity Pvt Ltd.
He also said another Rs. 348 million dividend of Perpetual Asset Management (PAM) was given to Perpetual Capital Holdings, which was the owning company of PAM, headed by Geoffrey Aloysius (father) and Arjun Aloysius (Son).
Justice Prasanna Jayawardena: You were a Director of Perpetual Asset Management in August 2016?
Witness: Yes
J: PAM received a net dividend of Rs. 90 million from PTL on August 8, 2016
W: Correct
J: Then PAM receives a net dividend of Rs. 348 million also from PTL?
W: Yes
J: So, during your tenure as a Director of Perpetual Asset Management, PAM received Rs. 458.548 million by way of dividends from PTL?
W: That is correct.
J: What happened to that Rs. 458 million?
W: Rs. 642 million was used to invest in buying voting shares of NDB, Central Finance and Ashok Leyland. And the Rs. 458 million received as dividends was also included in that Rs. 642 million.
The witness was of the view that PAM through its subsidiary company called Perpetual Equity had invested in buying NDB shares using Rs. 642 million.
J: You are a financial person please be careful in giving evidence. Did Perpetual Equity function as a stock broker?
W: Not a stock broker but it only invested in shares.
J: So, Perpetual Equity bought those shares of Central Finance, Lanka Asok Leyland and NDB under Perpetual Asset Management?
W: Yes
J: So, these shares are owned by Perpetual Equity from the part of funds received as dividends by PAM from PTL?
W: Yes
When Justice Jayawardena asked in which manner PAM had invested through its subsidiary Perpetual Equity to buy those shares, the witness said it was a way of lending given by PAM to its subsidiary.
W: There was another dividend of Rs. 348 million in Perpetual Asset Management which was paid to Perpetual Capital Holding in November 2016.
J: And what happened to that money?
W: I am not involved in Perpetual Capital Holdings (PCH).
J: Perpetual Capital Holding is owned by Geoffrey Aloysius and Arjun Aloysius, father and son, is that correct?
W: Yes
J: So, that money was paid to the Father and Son, who owned PCH.
W: That is correct
J: Do you know what happened to that money?
W: I don’t know about that.
It was also revealed that in addition to the shares that Perpetual Equity owns of Central Finance, Lanka Asok Leyland and NDB, The PTL also has Rs. 1.1 billion worth of shares of NDB. This gives Perpetual Group a total acquisition of Rs. 2 billion worth of NDB shares.
Meanwhile, after being questioned by Chairman of the Commission, Justice K.T. Chitrasiri over the lack of information in the submitted financial details, the Counsel who appeared for W.M. Mendis & Company yesterday told the PCoI that they will furnish all the financial details asked by the Commission within a week.
Justice Chitrasiri yesterday told President’s Counsel Anuja Premaratne that the Commission had received only a Balance sheet without the entirety of how all the expenditure and income happened.
When PC Premaratne agreed to provide them soon Justice Prasanna Jayawardena said those details might be with the audit company of the W.M. Mendis & Company.
The Commission also questioned on the required bank statements of W.M. Mendis & Company. PC Premaratne said that they have written to the banks and will be able to provide the original bank statements within a week’s time.
It was also revealed that W.M. Mendis & Company has provided its financial details relating to 12 bank accounts to the Commission.
In the Meantime, Perpetual Treasuries Ltd CEO Kasun Palisena yesterday undertook to provide details regarding its phone recording system in an affidavit as required by the Attorney General’s Department with the assistance of PTL IT expert.
The witness was of the view that he did not negotiate with the Metropolitan Company when installing the phone recording system in PTL. He said it was the IT expert who negotiated with them and he would be the best person to explain about the system.
The witness also said that the system is customized up to a certain point. When questioned by Justice Jayawardena on the manner in which the system was customized, Palisena said he will provide the details in an affidavit with assistance of the IT expert. (Shehan Chamika Silva)
