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OW Bunker - one of the world's leading sellers of marine fuel, with global sales of 29.2 million tonnes in 2013 - says that it is filing for in-court restructuring for a significant part of its business after having been informed about a $125 million fraud at its subsidiary in Singapore and discovering a "significant risk management loss" in addition to the loss of USD 24.5 million announced in its third quarter earnings report.

In a statement, the company said: "The board of directors regrets that it has not been able to find a solution with the syndicate banks. On this basis, it has been decided to file for commencement of in-court restructuring procedure in the subsidiaries O.W. Bunker & Trading A/S and O.W. Supply & Trading A/S at the probate court in Aalborg."

"The main operational activities of the group are located in these companies, which are expected to be insolvent," OW Bunker added.

The Danish firm said the purpose of the in-court restructuring procedure was to determine whether a basis for continued operations of the companies can be established, including the injection of further capital.

However, OW Bunker stressed: "For the time being, the financial impact cannot be assessed, however, it must be assumed that the group's equity is lost."

The company explained that the in-court restructuring procedure is aimed at debtors who are insolvent, but where there is a chance that all or part of the debtor's business may be able to continue operations after the completion of a restructuring.

"The procedure is intended to provide a tool for management and creditors alike, offering the possibility of rescuing an insolvent business, and thereby preserving its assets, rather than proceeding straight to the filing of a bankruptcy petition," the bunker firm added.