SINGAPORE (BLOOMBERG) – Troubled Singapore-based oil trader ZenRock has plans to wind down its business, with employees across offices in the city-state and China set to depart by August, according to people with knowledge of the matter.
ZenRock Commodities Trading is among a handful of trading houses in the spotlight after oil's historic plunge earlier this year, which has sparked feuds with international lenders and accusations of dishonest deals in Asia's commodities hub.
The company is expected to hand over responsibilities to a judicial manager, said the people, who asked not to be identified as the information is private. KPMG was named interim judicial manager in May, just as ZenRock was raided by police following allegations it used the same oil cargo to obtain more than one bank loan, according to court documents seen by Bloomberg.
Those accusations form part of its tussle with HSBC Holdings, which has an exposure of almost US$49 million (S$68.3 million) to the trader. The company owed more than US$166 million to six lenders as at April 17. It traded more than 15 million tonnes of oil and petroleum products last year and posted a revenue of US$6.15 billion for 2018, compared with US$1.24 billion for 2016, based on information on the website of Singapore's accounting regulator.
ZenRock was established in Singapore in 2014 by a group of veteran oil traders, including Mr Xie Chun and Mr Tony Lin. Mr Xie used to work for Unipec, the trading arm of Chinese state-owned oil-refining giant Sinopec, and Mr Lin was previously at Vitol, the world's biggest independent oil trader.
The company had about 100 employees globally, with about 60 of those based in Singapore. More than half of its staff have already departed in recent weeks, according to one of the people.
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