Harry J withdraws plans to appoint Dinesh to HNB board

Business tycoon Harry Jayawardena appears to have taken a step back in his plans to appoint former Commercial Bank Chairman Dinesh Weerakkody to the board of the country’s second largest private lender, Hatton National Bank PLC (HNB).
According to a stock exchange filing by HNB, three of its shareholders—companies controlled by Jayawardena—have turned down a request for an extraordinary general meeting to be held next Monday to adopt a resolution to appoint Weerakkody to the HNB board. 
Hence the EGM scheduled for Monday, 27th March at 10.00 a.m. will not be held. 

Jayawardena controls 10 percent of the voting rights and 17.90 percent of the shares in HNB through Distilleries Company of Sri Lanka PLC, Stassen Export Limited and Milford Export (Private) Limited.
The move to appoint Weerakkody to the HNB board comes in the backdrop of a proposed investment by the Asian Development Bank in HNB.
Asian Development Bank (ADB) last September agreed to invest US$ 50 million to acquire 9.9 percent of the shares in HNB on the basis that ADB would retain the right to nominate one director to the board.
According to past HNB statements, it has been reserving a board seat since 2012 for a potential foreign party who would invest in the bank to raise its profile.
By 25 October 2016, 79.60 percent of the shareholders of HNB had agreed to the ADB deal through proxies. 
However, on October 26, on the day of the EGM, the state-owned Sri Lanka Insurance Corporation—which had incidentally had belonged to Jayawardena once—which owns 14.64 percent of the shares in HNB, had withdrawn its proxies.
Jayawardena, who is the single largest shareholder in HNB, had then obtained an interim order restraining the issuance of shares to ADB.
HNB has filed an application to vacate the interim order, with the case currently pending in Court.
HNB Managing Director/CEO Johnathan Alles told Mirror Business last week that the bank is sincere in its offer to ADB. The bank recently also informed its shareholders that it is expecting the final director seat to be filled by ADB, or another strategic partner if an investment comes through.
Other large shareholders of HNB include the state-controlled Employees’ Provident Fund with a 9.78 percent stake, while the Captain family owns around 8.16 percent of the shares in the bank.