Hin Leong judicial managers file to wind up collapsed oil trader

Singaporean tycoon Lim Oon Kuin and his children racked up some US$4 billion in debt and entered court restructuring. PHOTO: ST FILE

SINGAPORE (REUTERS) - Judicial managers of collapsed oil trading firm Hin Leong Trading, have filed a winding up application for the company, according to a notice posted on a government website.

The move comes nearly a year after Hin Leong, once one of Asia's top oil traders owned by Singaporean tycoon Lim Oon Kuin - better known as O.K. Lim - and his children, racked up some US$4 billion (S$5.27 billion) in debt and entered court restructuring.

Court-appointed supervisors from accounting firm PwC submitted the application to wind up Hin Leong on Feb 5, according to the notice dated Feb 19 posted on the Government Gazette.

The application is expected to be heard by the Singapore High Court on March 8.

Under so-called 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.

Banks were already facing recoveries of pennies on the dollar following one of the largest corporate collapses in Singapore. HSBC has the most exposure at US$600 million, based on estimates in court filings last year. DBS Bank, ABN Amro Bank and OCBC Bank are next at about US$200 million to US$300 million each.

Lim and his son Lim Chee Meng have separately applied to wind up bunker supply unit Hin Leong Marine International, according to another notice on the website.

That case will be heard on March 2.

The Lim family, their lawyer and PwC did not immediately respond to Reuters' requests for comment.

Hin Leong had been seeking to restructure its debts after the oil price crash last year when its founder admitted in a court document to directing the firm not to disclose hundreds of millions of dollars in losses over several years.

PwC said in a report last year that Hin Leong had no future as an independent company after it "grossly overstated" the value of its assets by at least US$3 billion.

Join ST's Telegram channel and get the latest breaking news delivered to you.