04.20.20 - Lim Chee Meng, the only son of the legendary founder of Hin Leong (Lim Oon Kuin), recently stated his father had hid about $800 million in losses accumulated in futures trading. The allegations of a hole in the company’s finances correlates with the downfall of Hin Leong Trading Ltd. as a consequence of the Saudi-Russian price war throughout the current outbreak of the novel coronavirus pandemic.
Lim Chee Meng has also stated that the company sold off millions of barrels of refined products that it had previously used as collateral to secure loans from the bank – leaving a gaping hole between its current stock and its inventories it gave up as collateral to the bank. This shortfall could potentially lead to significant losses for the financial institutions that provided Hin Leong loans.
The company issued a statement to its creditors explaining that it only had about $140 million worth of oil products in its currents inventory – a stark contrast to the $128 billion it declared last October. Lim Chee Meng said his father sold a significant portion of the company’s inventories, despite that the inventory was put up as collateral for banks loans. Hin Leong has concerned many investors over its ability to finance its debts. It is rumored to owe about $4 billion to more than 20 banks, including HSBC.
Lim Oon Kuin has announced he will be resigning from all executive roles in Hin Leong as soon as April 17. He will also step down as director and managing director of Ocean Tankers and all related companies.
Source: The Economist