Autobahn Rent A Car fails to get court protection against creditors owed over $300 million
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Autobahn Rent A Car and its group of related companies, including car-sharing service Shariot, now faces creditor recovery action.
ST PHOTO: AZMI ATHNI
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- Autobahn Rent A Car, owing over $300 million, had its creditor protection application rejected by the High Court on December 26 and intends to appeal.
- Creditors, including DBS ($103 million), UOB ($17 million) and OCBC ($12.5 million), can now pursue debt recovery after the moratorium application failed.
- The debt primarily relates to vehicle hire-purchase agreements, concerning Autobahn's businesses, including Shariot and private-hire car rentals.
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SINGAPORE – Autobahn Rent A Car and its related businesses, which owe more than $300 million, had their application for creditor protection dismissed by the High Court on Dec 26, according to lawyers involved in the case.
The company, which offers vehicle rental, motor repair and financing, intends to appeal against the decision.
The majority of vehicles under Autobahn Rent A Car and its related business are rented out as private-hire cars used for ride-hailing services. The group also owns Shariot, which is a vehicle-sharing service.
Submitted documents show that creditors include finance companies and major banks. Among them, DBS is owed $103 million, UOB $17 million and OCBC $12.5 million.
In total, the debt exceeds $300 million.
On Nov 28, the group of companies applied for a six-month moratorium to halt creditor actions, including the repossession of assets, while they work out a proposed scheme of arrangement.
A moratorium is a court-supervised process that enables financially distressed companies to negotiate with creditors to restructure their debts and continue operating.
After the application is made, an automatic moratorium of 30 days is granted under the Insolvency, Restructuring and Dissolution Act 2018.
In response to The Straits Times, Mr Clarence Lun of Fervent Chambers, which represents Autobahn, said on Dec 26 that the application for further moratorium was dismissed, and while his client respects the decision of the court, he has been instructed to file an appeal.
Mr Parwani Vijai of Parwani Law, the firm representing seven creditors in the application, including Motor Way Credit and Supreme Cars Financial Services, told ST that the application has been dismissed, adding that his clients are relieved by the decision and are now working on the next steps on recovering what is owed to them.
Most of the debt relates to vehicle hire-purchase agreements, with the business loans, mortgages and fees making up the remainder.
Autobahn Rent A Car and its group of related companies were reported to have a fleet of 1,700 vehicles, having grown from 500 vehicles over the past few years after the Covid-19 pandemic.
On Dec 26 evening, Autobahn Rent A Car posted on its Facebook page informing hirers of its vehicles of the High Court hearing, and that it was appealing against the decision.
Business operation, the company said, will continue as usual.
It added: “Autobahn remains committed to discharging its responsibilities and safeguarding the interests of its partners. The safety, mobility and continuity of service for hirers remain a key priority.”
