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Singapore Bank Seeks Court Intervention for Distressed Shipping Group

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By The Maritime Executive 07-24-2020 01:08:00

Singapore’s OCBC Bank has sought a court-appointed supervisor to manage shipping firm Xihe Holdings Pte Ltd and four of its subsidiaries. 

Xihe Holdings is part of the troubled Singapore-based Lim family business empire, which also includes oil trader Hin Leong Trading and fleet manager Ocean Tankers (Pte) Ltd, both of which were placed under court-appointed supervisors earlier this year.

Hin Leong is seeking to restructure billions of dollars of debt after the oil price crash revealed a massive, years-long fraud at the once fabled trading house. OCBC is owed $250 million, making it Hin Leong’s fourth biggest secured creditor, according to a presentation by Hin Leong to lenders in April.

Xihe Holdings, owned by Hin Leong founder Lim Oon Kuin, his son Evan Lim Chee Meng and daughter Lim Huey Ching, controls a shipping fleet that ranges from coastal barges to very large crude carriers (VLCCs).

OCBC Bank wants a court-appointed manager to run Xihe to maximize its chances of recouping some of the money it is owed. The bank wants to avoid the risk of other creditors trying to sell assets belonging to Xihe and its subsidiaries in a fire-sale, one of the sources told local media.

The bank is said to have applied for Xihe Holdings and its subsidiaries, Da Xin Tankers (Pte) Ltd, Hua Guang Shipping Pte Ltd, Nan King Maritime (Pte) Ltd and Hua Xin Shipping Pte Ltd, to be placed under the supervision of Grant Thornton Singapore. 

Hin Leong’s judicial managers PricewaterhouseCoopers discovered that the oil trader had overstated its assets by more than $3 billion through widespread forgery and have recommended it merge with other companies owned by the Lim family, including Ocean Tankers and Xihe Group.