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The chairman of OW Bunker has warned that the group is in danger of being liquidated following recent events that have resulted in the company deciding to file for in-court restructuring.

"The company is at risk of going bankrupt," Niels Henrik Jensen is quoted as saying to Reuters. "We have decided to file for the commencement of a court restructuring process."

In a turbulent week for OW Bunker, the Danish group claims to have been informed about fraudulent activity carried out by senior employees at its Singapore-based subsidiary, Dynamic Oil Trading. The full extent of the alleged fraud is not yet clear, but the firm says preliminary findings suggest a potential loss of around $125 million.

In addition to this, the company has upgraded the estimated trading loss from its risk management activities from the $24.5 million reported in its third quarter results to "around $150 million".

Jensen told Reuters that Danske Bank and Nordea were still supporting the company, but as 11 international banks had withdrawn their support, OW Bunker's management had decided to seek a court restructuring procedure.

The prospect of one of the world's largest sellers of marine fuel going bankrupt marks a dramatic turnaround in the fortunes of OW Bunker, which just a few months ago (in March) announced that it had achieved an adjusted gross profit of $218.8 million in 2013 - an increase of $54.3 million (33%) compared to $164.5 million in 2012 - and that sales volumes had increased by 32% to 29.2 million tonnes in 2013 from 22.1 million tonnes in 2012.

Perhaps the end-of-year data of most relevance to recent events is that, as at December 31, 2013, OW Bunker's total liquidity reserves amounted to $303.2 million. The company had also just signed a $700 million revolving credit facility, refinancing a $450 million facility. As part of its credit facility, OW Bunker also had an option to request a $100 million accordion facility at the discretion of each of its lenders.

Fast forward just eight months after the March announcement and OW Bunker - the second largest company in Denmark in terms of revenue - is now expected to be declared insolvent and is said to owe 13 banks $750 million.

OW Bunker was listed on Nasdaq OMX Copenhagen in March at 145 Danish crowns per share, giving the firm a stock market value of around 5.3 billion Danish crowns ($891 million).

Yesterday (November 5), shares were priced at 83.50 crowns before trading was suspended by the Copenhagen Stock Exchange prior to the fraud announcement.