EXCLUSIVE: oBike Singapore owes at least S$1.7m to creditors, users

SINGAPORE — oBike Asia, the bicycle-sharing firm’s Singapore-registered entity, owes at least S$1.7 million to creditors and users, and in costs chalked up from its wind-up here, TODAY has learnt.

Based on documents — which exclude those for liquidator fees — seen by this news site, oBike Asia drew proof of debt from 30 or so creditors totalling S$743,189.

• These include payments owed to town councils, suppliers and government agency, the Land Transport Authority (LTA).

• The biggest proof of debt was from logistics firm West-Street Carrier (S$130,753), followed by the Bishan-Toa Payoh Town Council (S$85,660) and Channel Management Systems (S$84,682), which also provides logistics services. The LTA is owed S$15,000.

• Claims made by 8,854 deposit-holders totalled S$405,314 as of October last year, the documents revealed, while FTI Consulting’s fees are understood to be around S$600,000.

FTI Consulting had said in August last year that oBike’s Singapore business owes S$8.9 million to about 220,500 users here.

The firm has a new majority shareholder who has struck a deal with its founders to take over the firm’s global business and clear its spiralling debt, TODAY has learnt.

But the new shareholder, 29-year-old Costa Rican investor Oscar Moises Chaves, said he is determined to fulfil the firm’s obligations to its creditors, but repayment in Singapore — where the firm is in liquidation — has hit an impasse.

Channel Management Systems’ managing director, who wanted to be known only as Mr Ong, said he telephoned the liquidators last month to seek updates, to no avail.

He was not optimistic the firm would get its money returned. “The liquidators just said to look out for their press releases,” he added.

oBike’s debts appear to have outstripped the funds mustered so far. As of Oct 15 last year, documents showed oBike Asia had a running balance of S$481,449, derived mostly from scrapping bicycles here.

When a firm shuts, the Companies Act sets out the order of priorities under which funds should be distributed to creditors.

It states that priority should first be given to paying the costs and expenses of the wind-up, including the liquidator’s remuneration. Other unsecured debts — including user deposits in oBike’s case — come last.

Mr Chaves has offered to dip into his own pocket to pay off user deposits, as has former oBike chairman Shi Yi.

Still, Mr Daniel Tay, a partner at law firm Chan Neo LLP, said oBike’s liquidators are required to distribute its funds to preferential creditors before unsecured ones such as users, in accordance with the Companies Act.

“Even if offers are made to inject funds into oBike, it is unlikely that the liquidator can use these funds to pay off oBike users first,” he added.

Several months on, the stuttering progress of repayment has not gone unnoticed.

“We urge the liquidators to begin the repayment process,” an LTA spokesperson said.

The transport regulator noted that FTI Consulting was engaging oBike and its creditors to reach a settlement, and has been exploring various options in the interest of creditors.

“Creditors should continue to work with FTI on this,” the LTA spokesperson added.

With nary a warning sign, oBike’s departure last June sent scores of Singapore users scrambling to recover their S$49 deposits (S$19 for students).

The Consumers Association of Singapore has since recorded 1,396 complaints against the firm.

Its executive director Loy York Jiun told TODAY on Wednesday (Jan 16) that the association has not received firm indication from the liquidators on the refund of customers’ deposits.

“We are in contact with the liquidators and will check with them on the status regularly,” he added.