The Singapore-based trader of crude, oil products and petrochemicals is yielding to HSBC's bid to place the company under judicial management, a form of debt restructuring.
Zenrock informed the Singapore High Court of its decision last week, with the hearing set for July 13, «The Business Times» reported.
According to the report, Zenrock had earlier resisted HSBC’s application, which was approved by the court in a virtual hearing in May, but has had a change of heart. HSBC said that the company, which recorded a turnover of $8 billion and gross profit of $35 million, was «clearly insolvent and had little money to repay its debts, according to court documents.
Zenrock owes at least six banks a total of $166.1 million and has outstanding balances of $449 million, according to a bankruptcy protection application filed in May. The creditor banks are said to be HSBC, Natixis, Crédit Agricole, ING Bank, Bank of China, and Banque de Commerce et de Placements, with HSBC having the largest exposure at $49 million.
Oil Troubles
The scandal comes on the heels of the collapse of oil trader Hin Leong, which has threatened to cut bank financing to commodity traders in the city-state, the world's key oil market and top bunkering port.
According to court documents, Hin Leong hid about $800 million in losses from futures trading from its financial statements.
