Radiant World’s Singapore entity has been placed under interim judicial management following an application by Japanese lender Mizuho, a person familiar with the matter said.
The court has placed Radiant World Corporation Pte Ltd in the hands of three personnel from KPMG, removing founder and chairman Pinkesh Nahar from control of the firm.
Interim judicial management involves independent officers taking over a company’s operations until a court makes a final decision on a judicial management request. If the request is granted, the managers will assess options such as restructuring.
The iron ore and metals trader has come under intense pressure in recent months over allegations from lenders and major trading partner Glencore that it fabricated invoices, emails and other documents in order to obtain and retain receivables financing facilities. Radiant World has consistently denied wrongdoing.
Mizuho filed its application at the end of August, alleging that Radiant World had faked emails from Glencore that purported to confirm the existence of US$95.5mn in receivables the bank had financed, according to court documents seen by GTR.
Mizuho claimed it was told by Glencore that several emails purporting to come from one of its staff members “were generated fraudulently”.
A spokesperson for the bank declined to comment on the court’s decision. A further closed hearing in Mizuho’s application is scheduled for October 1.
Read more: Radiant World: The allegations, creditors and what happens next
Radiant World has grown rapidly in recent years and secured traditional trade financing from a range of banks, as well as large receivables finance facilities from banks and funds, chiefly a Jefferies trade finance fund.
The more than US$1bn in assets declared by Radiant World’s Singapore entity is almost entirely made up of trade receivables due from debtors, according to a schedule of assets provided by Nahar to the court and seen by GTR.
The largest debtors include Glencore, Vitol and several companies related to Radiant World. The only significant current asset is US$33.5mn of iron ore stock, the excerpt of Nahar’s affidavit shows.
KPMG and Radiant World did not immediately respond to requests for comment.
The court’s decision was first reported by Bloomberg.
