Danish ship fuel supplier OW Bunker has filed for bankruptcy at the probate court in Aalborg, Denmark, after it failed to find a sustainable finance solution.
The filing follows an alleged fraud by suspected senior employees in its Singapore-based subsidiary Dynamic Oil Trading (DOT). Although the extent of the fraud is not yet clear, the preliminary findings determine a potential loss of around $125m.
The company, which also faced a significant risk management loss, filed for the start of in-court restructuring procedure in the subsidiaries OW Bunker & Trading and OW Supply & Trading at the probate court in Aalborg.
The in-court restructuring procedure will establish an overview of whether a basis for continued operations of the companies can be established, including adding further capital or other similar solution.
OW Bunker board of directors chairman 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."