SEC suppressed info, Counsel of Melstacorp tells Court

The hearing of the alleged breach of the Mergers and Acquisition Code by Melstacorp Ltd., over Lanka Milk Foods (LMF) was taken up at the Magistrate’s Court on Friday 21 September.

Defence Counsel C.R. De Silva, President’s Counsel, appearing on behalf of the defendant company, took up objection that the Mergers and Acquisitions code was not triggered as it was not relevant in this case.

The Mergers and Acquisition Code came into being in 1995. In November 1991 Milford Exports Limited in concert with a passive shareholder (who is still a shareholder) acquired over 50% of shares in LMF and the former controlling the Board of Directors since 1991. Since the group was already in control since 1991, there could not have been a takeover for the second time. The above information was suppressed by the Securities and Exchange Commission in its report.

It was further stated that the SEC has not come to court with clean hands. The defendant company has already filed a case in the Appeal Court which has been taken up for hearing and notice has been served on the Securities and Exchange Commission.

Considering the submissions made, it was decided to await the outcome of the Appeal Court decision prior to taking up the above. Accordingly, 8 February 2013 was provided as the next date for hearing.