Jurong Port completes takeover of 41% stake in Universal Terminal

SINGAPORE port operator Jurong Port has completed its acquisition of Universal Terminal, a commercial storage facility on Jurong Island and a prized asset of entities owned by the Lim family of failed Hin Leong Group, making it the largest independent oil storage operator in Singapore.

A spokesperson from Jurong Port confirmed to The Business Times (BT) that the acquisition of a 41 per cent stake in the giant oil terminal was done but declined to comment on the price tag.

The deal vaults Jurong Port's position in the oil storage business. Two years ago, the port operator set up Jurong Port Tank Terminals (JPTT) under a tie-up with German firm Oiltanking, with the aim of boosting the city-state's status as a key port for the supply of clean maritime fuel.

"With this new acquisition, it would create strategic depth and critical mass for our business in the area of oil handling," said the spokesperson.

Universal Terminal, the size of 60 standard football fields, is also part owned by China's oil giant PetroChina and Australia's Macquarie Asia Infrastructure Fund.

The deal follows hard on the heels of a winding-up order granted by the Singapore court earlier this month on Hin Leong Trading (HLT) after its court-supervised managers, having exhausted all options to sell the assets under the group as an integrated oil platform, applied to shutter the firm.

HLT, the flagship firm of the Lim family led by Lim Oon Kuin or OK Lim who himself faces forgery-related charges, collapsed on massive debts following the historic oil crash last year that was brought about by the Covid-19 pandemic. Recent court filings revealed that as at end-October 2020, HLT had assets worth an estimated realisable value of US$273.28 million and total debt of US$4.59 billion.

HLT's judicial managers-turned liquidators Goh Thien Phong and Chan Kheng Tek of PricewaterhouseCoopers decided to wind up the firm on the basis that it was "clear and undisputed" that it was unable to pay its debts.

The latest sale confirms a Reuters report last December that the government-owned port operator Jurong Port was in advanced talks to buy a stake in the terminal.

BT understands that the Universal Terminal deal has been on the block for over a year since the troubles at the group first showed up. Desperate for funds in the early days of the debt dilemma, the Lim family was believed to have sought prospective buyers for Universal Terminal. Nothing had come off that at that point. HLT - and eventually a few other connected entities - was placed under judicial management, and less than a year later, is being wound up.

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