EMEA News
OW Bunker: Bank Snubbed as Investors Make Headway on Secret Lawsuit Code Named "Project Black"
Confidential papers are alleged to have revealed a secret potential lawsuit code named "Project Black" which is expected to be brought forward by a consortium of institutional investors against now-defunct OW Bunker and private equity fund Altor Equity Partners, Danish media reports.
According to media outlet Finans, the name reportedly comes from confidential statements sent by Danish law firms Accura and Bruun & Hjejle, both of whom were appointed by the investors to investigate whether OW Bunker's IPO prospectus contained flaws.
The lawsuit is expected to target both OW Bunker and Altor, who was the fuel company's main owner prior to its IPO.
Separate reports say that the decision of whether to proceed with the lawsuit now rests largely on the consortium's two largest investors, pension funds ATP and PFA Asset Management.
Many of the group's smaller institutional investors are reportedly highly in favour of court action, but are taking ATP and PFA's lead.
Bank Boycott
Meanwhile, ATP, one of Denmark's largest pension funds, has also reportedly reduced or stopped placing trades with Swedish investment bank Carnegie Investment Bank AB, who was one of three banks involved with OW Bunker's offering.
Carnegie, Nordea, and Morgan Stanley all advised on the IPO, which became Denmark's second largest since 2010.
"It would be wrong to announce an official boycott, but we weigh up all factors when we decide which banks we use for trading," Britain's Financial Times (FT) quoted ATP CIO Henrik Gade Jepsen as saying.
However a spokesperson for Carnegie was quoted by FT as saying: "The fact is we are still doing business with all clients that were clients before November 2014. It is understandable and not unusual that volumes can be affected by a situation such as the bankruptcy, since all the facts are not known."
Signs of trouble at OW Bunker first became apparent in October 2014 when the company reported an unrealised loss of $22 million in its quarterly earnings.
The month after, it was reported that the company had suffered an alleged $125 million fraud at its Singaporean subsidiary, along with another $150 million risk management-related loss.
Mere days after, the company formally declared bankruptcy in Denmark, which was quickly followed by similar filings at its U.S. and Chinese subsidiaries.
