Singapore-based oil trading company GP Global APAC Pte Ltd has applied for court intervention to block any minority creditor who falls out of line while its parent company, GP Global undergoes restructuring, reports GT Review.
In the court filing obtained by GT Review, GP Global APAC recounts how the company ran into financial difficulties in 2020, brought on by pandemic-related economic lockdowns, a fall in demand for oil products, record low oil prices and banks tightening their line of credit to finance commodity trades.
Additionally, several fraudulent and fictitious trades allegedly left the company saddled with bad debt to the tune of more than USD 1.2 billion in bank loans and USD 460 million to 20 unsecured lenders, the three largest of which are UBS (USD 70.4 million), Credit Suisse (USD 91 million) and UniCredit.
According to the filing, once the company is restructured and assets are sold, banks could recover between 34% and 47% of losses, but if the company enters liquidation and suffers a forced asset sale, the estimate is just 9%.
Moves to restructure have encountered some issues with smaller creditors in Singapore. One such creditor is owed around USD 670,000 in claims and obtained a court ruling allowing it to seize GP Global APAC’s Singapore office which is worth eight times that amount if sold as part of the restructuring process.
According to the document, GP Global APAC said such creditors “should not be allowed to steal a march on the rest of the creditors” and thus it submitted a court filing on 19 February to halt the seizure and allow the property to be sold as part of restructuring efforts.
Nevertheless, the process in Singapore has run into some complications where DBS Bank allegedly terminated a USD 6.4 million facility it had made available to GP Global APAC just days after its Singapore office came under threat of seizure.
Chevron has also purportedly warned it would file for a winding-up order against the company.
A list of earlier coverage regarding GP Global can be found below:
Related: GP Global APAC files for six-month debt moratorium with Singapore High Court
Related: Argus Media: GP Global asset sale talks drag on valuation gap
Related: ExxonMobil Asia Pacific takes GP Global APAC to court over USD 2.8 million bunker claim
Related: Restructuring advisor flags up ‘accounting irregularities’ in GP Global books
Related: Gulf Petrol Supplies files complaint against GP Global unit for fraudulent behavior
Related: Second arrest warrant issued for GP Global’s ‘GP B3’ over outstanding bills from creditors
Related: GP Global considering sale of assets in an effort to repay creditors
Related: GP Global tanker ‘GP B3’ detained in India due to loan defaults with creditors
Related: Argus Media: GP Global clarifies that it has shut only lesser performing trading desks
Related: Argus Media: GP Global rules out asset sales in restructuring
Related: GP Global engages restructuring specialists following credit pull and internal fraud
Related: GP Global internal investigations reveal Sharjah and Fujairah staff involved with fraud
Related: GP Global repudiates rumours and proceeds with restructuring as strategic move
Photo credit: Manifold Times
Published: 24 February, 2021
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