'White knight' rescues Jungceylon

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'White knight' rescues Jungceylon

PATONG: A mystery white knight has ridden to the rescue of the stalled Jungceylon megamall project, buying 53% of the mall’s operating company from one of the two main partners, who have been at loggerheads for months.

The identity of the white knight is being kept secret for the moment, but it is understood to be a major investment fund, which has pledged sufficient money to wipe out the operating company’s debt and give it the funding it needs to complete the mall.

The deal breaking the deadlock between Thanit Rattana-Kamchai – who owns the site – and Manit Udomkunnatum, principal of the operating company, Phuket Square Co, was brought about through mediation efforts headed by Samrarn Yothayai, Chief Judge of Phuket Provincial Court.

Judge Samrarn revealed that the two parties met at the Bankruptcy Court recently to conclude a deal with the project’s major creditor, Krung Thai Bank, whereby K. Manit relinquished his 53% share of Phuket Square Co to K. Thanit, backed by the mystery investor.

As a result of that hearing, the investor will cover all the debt accumulated by K. Manit, and both K. Manit and K. Thanit will withdraw all pending lawsuits against one another.

Jungceylon, which occupies 55 rai of land off Rat-U-Thit 200 Pi Rd, was due to open in November last year, but K. Thanit and K. Manit became involved in a protracted legal dispute in early 2004, over the ballooning cost of the project.

Originally Jungceylon was projected to cost 1.7 billion baht, but this soared to 3 billion baht, and K. Manit started looking for new investors to join the project.

K. Thanit, however, disagreed with this strategy, saying that he could accept neither the inflated cost nor changes to the management committee of Phuke t Square Co. He refused to countersign checks issued by K. Manit to pay the main Jungceylon contractor, Powerline Co.

Powerline stopped work and, as a result, Krung Thai Bank declared its loan to K. Manit to be in default. It filed a complaint with the Bankruptcy Court in Bangkok, asking for him to be declared bankrupt.

With the new injection of funds, however, Powerline could soon be back at work on the Jungceylon site. Judge Samrarn told the Gazette he understood the mall could open for business as early as September this year.

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The Phuket Gazette
12:24 local time (GMT +7)