Jurong Aromatics pushed into receivership after debt-restructuring talks stall

30-Sep-15

Jurong Aromatics Corp., operator of one of the world’s largest petrochemical plants, has been pushed into receivership after debt-restructuring talks stalled amid faltering demand for commodities. This comes amid a China-led slowdown that has hurt prices for commodities and Jurong Aromatics’s shareholder Glencore losing almost US$45 bln in market value this year. Restructuring firm Borrelli Walsh has been appointed the receiver of the US$2.4 bln plant on Singapore’s Jurong Island. Jurong Aromatics, whose shareholders include South Korea’s SK International Investment and Glencore Plc, has not been able to service interest payments amid a plunge in oil prices, and operations have been stalled since December, as per people familiar with the matter. Jurong had been locked in talks with lenders including BNP Paribas SA and Standard Chartered Plc, as well as suppliers Glencore Plc, BP Plc and SK Energy Co, as per confidential sources. The company had US$1.53 biln in liabilities and US$68.7 mln of accumulated losses as at the end of 2013, according to the company’s latest available financial records. BP, Glencore and SK Energy have secured claims against the firm, while BNP Paribas led a US$1.73 bln loan facility in 2011 that has yet to be repaid. The company shareholding is as follows: 30% held by SK International Investment, 25% by China’s Jiangsu Sanfanxiang Group Co. and 10% by Glencore. Other shareholders include Arovin Ltd., Shefford Investments, UVM Investment Corp. and Essar Ltd.