Singapore’s High Court on Monday approved an application to wind up collapsed oil trading firm Hin Leong Trading Pte Ltd, marking the end of what was once one of Asia’s top oil traders, three sources familiar with the matter said.
Hin Leong, owned by Singaporean tycoon Lim Oon Kuin and his children, racked up some $4 billion in debt and entered court restructuring nearly a year ago.
The company had been seeking to restructure its debts after the oil price crash last year when Lim admitted in a court document to directing the firm not to disclose hundreds of millions of dollars in losses over several years.
Court-appointed judicial managers Goh Thien Phong and Chan Kheng Tek from accounting firm PwC had submitted an application to wind up Hin Leong on Feb. 5 and have been appointed as joint liquidators of the company, the sources said, speaking on condition of anonymity as they were not authorised to speak with media.
The Lim family, their lawyer, Singapore High Court, PwC, Goh and Chan did not immediately respond to Reuters’ requests for comment.
Hin Leong, which was set up in 1973 to trade primarily in petroleum products, was placed under judicial management in August, last year.
Under judicial management, a court appoints an independent manager to run the affairs of a financially distressed company in the place of existing management.
When a company is wound up, its business will stop operations and its assets will be handed over to an independent liquidator.
In a court document filed by the judicial managers last month and seen by Reuters, the managers said that efforts to sell Hin Leong Trading and its affiliated companies as an integrated group were not successful.
They said that potential investors had included state-owned enterprises and other companies from China as well as several regional and global traders in the oil and gas industry.
They added that as of Oct. 31, last year, Hin Leong had assets with an estimated value of $273.28 million and total liabilities of about $4.59 billion.
With all trading and operations at the company having stopped and no viable proposal on hand for any injection of funds by an investor, the company is “not in a position to trade out of its insolvency or restructure its debts”, they said, adding that as such, the company should be wound up.
Source: Reuters.com