Mitsubishi Corporation (MC) on Wednesday (6 November) said it will be liquidating Petro-Diamond Singapore (Pte) Ltd. (PDS).
As reported on September 20, an employee who was hired locally by PDS engaged in a series of unauthorised crude-oil derivatives transactions over an extended period.
PDS has confirmed that after closing the positions concerned, it will realise a loss of approximately 34.2 billion yen (USD 310 million) before taxes, which could put the subsidiary’s final debt as high as 30.8 billion yen.
“MC shall liquidate PDS once the subsidiary has completed its contracted trade of crude oil and petroleum products and its credits and debts have been settled,” it stated.
“The detailed schedule of the liquidation shall be determined based on required processes and considerations.”
MC notes PDS shall fulfil its remaining contractual obligations for the trade of crude oil, naphtha and petroleum products.
Meanwhile, MC shall continue its overseas crude oil / naphtha / petroleum products operations once it has reconfirmed that its risk management systems are both sound and thoroughly enforced, taking all possible measures to prevent similar incidents from occurring in the future.
“MC and other parties have continued to investigate this incident since the initial announcement was made on September 20.
“Thus far, we have not confirmed anything that contradicts the information previously reported.
“All MC subsidiaries and other MC Group entities engaged in derivatives transactions are expected to tighten their risk management and are committed to preventing any recurrences of this incident.
“MC is cooperating fully with the authorities investigating this matter and shall continue to do so throughout and following the liquidation process.”
Published: 6 November, 2019
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