Danish marine fuel supplier OW Bunker has not been able to find a sustainable solution regarding in-court restructuring procedures in the subsidiaries O.W. Bunker & Trading A/S and O.W. Supply & Trading A/S, and as a consequence, the company and its subsidiaries filed for bankruptcy.
The probate court in Aalborg has already issued a bankruptcy order in OW Bunker A/S.
On November 6, OW Bunker issued a statement saying that the company was investigating an alleged fraud committed by senior employees in its Singapore-based subsidiary Dynamic Oil Trading (DOT), saying that the extent of the fraud was not clear at the time, but preliminary findings suggested a potential loss of around USD 125 million.
OW Bunker also said that a review of risk management contracts has revealed a significant risk management loss in addition to the loss of USD 24.5 million announced on October 23, 2014. According to the company, the mark to market loss is around USD 150 million.
As a result of the internal investigation OW Bunker decided to report two key employees in the Singapore-based subsidiary Dynamic Oil Trading (DOT) to the police and to relieve them of duty immediately.
OW Bunker Chairman of the Board of Directors, Niels Henrik Jensen said: “Since the credit facility was closed down on Wednesday, the underlying business has eroded significantly. The banks hold mortgage over all receivables and consequently, without the provision of new, significant credit facilities in the immediate future, it is not possible to save the remaining business. It is now clear that such facilities will not be made available. Nor is a sale as going concern a realistic option. We are therefore left with no option but to file for bankruptcy. On behalf of the entire board of directors and management, we deeply regret this outcome and the consequences affecting the company, its employees, shareholders and business partners.”