Krys’ Singapore network partner seeks Chapter 15 amid global litigation
The Singaporean liquidator of a wholesale trader has sought Chapter 15 recognition in New Jersey to deal with what he calls “dilatory, value-destructive and possible fraudulent tactics” pursued by alleged creditors against the company in the state.
On 8 October, Wayne Burt’s Singaporean liquidator filed for Chapter 15 recognition of the trader’s liquidation as foreign main proceedings in the US Bankruptcy Court for the District of New Jersey.
The liquidator, Mann & Associates director Farooq Mann in Singapore also asked to be recognised as its foreign representative, saying in a supporting statement that he was seeking recognition in order to short circuit “gamesmanship” from certain of its alleged creditors.
In particular, Mann is seeking to enforce a 2023 Singapore High Court ruling ordering three of Wayne Burt’s alleged creditors to return more than 29.6 million shares in Indian petrochemicals manufacturer Cetex Petrochemicals to the debtor.
According to Mann’s supporting declaration, Wayne Burt had allegedly pledged the shares to creditors based in New Jersey – Vertiv Capital, Vertiv and Gnaritas – as security on alleged loans from the Vertiv entities worth a combined US$16 million.
The trio had taken possession of the shares after obtaining two consent orders from the New Jersey District Court based on their claims that Wayne Burt had defaulted on the loans and owed the three New Jersey entities US$29 million.
Mann claims in his statement that the Jersey court granted the “nearly identical” pair of orders in January and November 2020, with the consent of two of Wayne Burt’s former directors signing on behalf of the company, Mahesh Triplicani Gowri Sankar and Rangamani Krishnan.
Mann, who stated he was “unaware of and excluded entirely” from the Vertiv entities New Jersey claims, filed a motion to vacate the consent judgments in February 2021 after discovering that the Vertiv entities had started proceedings in India to obtain the Cetex shares.
In July that year, the New Jersey District Court vacated the judgments, finding that Mann had produced “substantial and compelling evidence of the fraudulent nature” of the loans alleged by the Vertiv entities. The court added that the Singaporean winding up order had stripped Wayne Burt’s former directors of their authority and empowered Mann as the only party able to consent to judgments on the company’s behalf.