Court orders Wellness Group to be wound up

Singapore

THE High Court has ordered the winding-up of The Wellness Group (Wellness), having found that two of the directors - husband and wife Manoj Murjani and Kanchan Murjani - have treated it "as if it belongs to them alone and its funds as if they are their piggy bank".

Mr Murjani is the co-founder of the luxury tea brand TWG Tea, which is 30 per cent owned by The Wellness Group.

Justice Chua Lee Ming on May 2, in granting the petition to wind up Wellness, said he agreed with the submissions of the applicant - an investment vehicle of Ron Sim - about the way that Mr Murjani, his wife and their company Sunbreeze Group Investments treated Wellness' funds.

According to a separate court judgment in 2017, Sunbreeze is the majority shareholder of Wellness with a 80.62 per cent stake. Mr Murjani and his wife are directors of Wellness, and shareholders and directors of Sunbreeze.

Justice Chua, in ordering Wellness to be liquidated, noted that no audited accounts have been done and annual general meetings have not been held for several years.

In addition, Mr Murjani, who was former chief executive of TWG Tea, has caused Wellness to borrow S$1.044 million and S$3.1 million to pay legal costs including those that should have been borne by Mr Murjani personally, the judge said.

Further, he paid himself remuneration without obtaining prior written consent from the board.

Wellness' only known asset currently is its stake in TWG Tea. The application to liquidate Wellness came from EQ Capital Investments, which is represented by Senior Counsel Davinder Singh and lawyer Jaikanth Shankar.

EQ, an investment holding company owned by the boss of lifestyle company Osim International Ron Sim, has been Wellness' shareholder since 2008.

Wellness' other shareholders are Vickers Private Equity Fund and Vickers Venture Fund Justice Chua said he was also satisfied that based on the facts of this case, there is no exit mechanism that allows EQ to exit Wellness at fair value.

He also pointed out that the financial affairs of Wellness are in a real mess. Full grounds will be provided in due course for giving the winding-up application the green light.

Partners from SR Associates have been appointed the liquidators for the winding up of Wellness, taking over the entire affairs of the company.

A notice of the winding-up order was published in The Straits Times on Thursday, informing creditors of Wellness to file proof of debt with the liquidators, and all debts due to Wellness should be forwarded to the liquidators as well.

However, sale of Wellness' stakes in TWG Tea will be put on hold pending an appeal by Sunbreeze.