Gulf Oil buys Hin Leong shipping arm's lubricant business for $48.6m

A unit of Indian conglomerate Hinduja Group has acquired several assets from bankrupt Hin Leong Trading's shipping arm Ocean Tankers for US$36 million (S$48.6 million) plus inventory, The Straits Times understands.

Ernst & Young (EY), the judicial manager of Ocean Tankers, told ST yesterday morning that the sale of Ocean Tankers' lubricant business, including its lubricant blending plant, storage tank farm, terminal facility in Tuas and certain other assets, to Gulf Asia-Pacific has been completed.

The sale fulfilled one of the purposes of the judicial management, which is "the survival of the company, or the whole or part of its undertaking as a going concern", Ocean Tankers' judicial manager Angela Ee told ST.

The deal is subject to closing conditions.

According to the judicial managers' update to creditors, which was seen by ST, the deal was completed on Wednesday, with Ocean Tankers receiving US$36 million for the facility assets plus an inventory sum of US$1.3 million in consideration for the sale of the lube business.

"The inventory sum is subject to adjustment to reflect the value of various items in the company's inventory as of the completion date. Parties are still in the process of calculating the value of these items," said the judicial managers.

Along with Hin Leong, which was founded by former oil tycoon Lim Oon Kuin, better known as O.K. Lim, Ocean Tankers came under full judicial management in August last year due in part to its exposure to potential claims of US$2.67 billion allegedly stemming from its dealings with the oil trader.

EY, as judicial manager of Ocean Tankers, sued Lim, his son and his daughter over US$19 million allegedly transferred from the firm's bank account to their personal accounts just days before the company filed for the debt moratorium.

The sum covers US$19 million transferred from the shipping company on two occasions last year to the Lims' bank accounts, as well as interest and costs, totalling US$20.1 million. The High Court ordered the sum to be paid to Ocean Tankers, but the family appealed against the order in May after paying the sum.

Mr Mike Jones, chief executive of Gulf Oil International, yesterday said Ocean Tankers' plant offers a strategic opportunity for the company to invest further in the marine segment and grow its market share in marine lubricants and other services. It will also provide a regional hub to accelerate its business development plans in South-east Asia within the automotive sector.

A version of this article appeared in the print edition of The Straits Times on July 09, 2021, with the headline 'Gulf Oil buys Hin Leong shipping arm's lubricant business for $48.6m'. Subscribe