Jan. 8 (Bloomberg) — Chemoil Energy Ltd. had the biggest
decline in almost four months in Singapore trading after Chief
Executive Officer Robert Chandran died yesterday from injuries
sustained in a helicopter crash in Indonesia.
The stock fell as much as 8 cents, or 16 percent, to 43.5
cents on the Singapore Exchange and traded at 47.5 cents at 2:54
p.m. local time. That was the biggest drop since Sept. 18, when
the shares tumbled 25 percent after Chemoil forecast a third-
quarter loss because of delays to a supertanker storage project
and hedging losses.
The market value of Singapore-based Chemoil, the worlds
largest independent supplier of marine fuels, has plunged 30
percent since the profit warning. Chandran, who held 50.5 percent
of the companys shares, said on Oct. 4 the business would “go
back to normal growth in the fourth quarter, with plans to
spend as much as $55 million on an oil storage terminal in Panama.
“This tragic development is a major setback to Chemoil
Energy, Nirgunan Tiruchelvam, an equity analyst with ABN Amro
Asia Securities Pte, said in an e-mail. “It is likely that the
Chandran family will play a major role, given their large
stake.
The helicopter crashed in Indonesias Riau province on Jan.
6. Terence Gidlow, the companys vice president of business
development, was injured in the crash and is in a stable
condition, Singapore-based Chemoil said in an e-mailed statement
today.
Choosing a Successor
The board is continuing talks to pick a successor, Chemoil
said in the same statement.
The company is building terminals to increase storage
facilities for use by customers including A.P. Moeller-Maersk A/S,
the worlds largest shipping company, and Taiwans Evergreen
Marine Corp.
Chemoils rating was cut to “neutral from a “trading
buy at CIMB-GK Research. The earnings forecasts and 12-month
price target of 74 cents were left unchanged.
“Mr. Chandrans death introduces uncertainty into Chemoils
immediate prospects, and his importance to the company is likely
to produce short-term selling pressure, CIMB-GKs analyst
Robert Adair said in a report today.
Itochu Corp., a Japanese trading company, is expected to
play a bigger role in the company as it is the second-largest
shareholder, Adair said. Itochu owns a 37.5 percent stake.
“Itochu Corp. will be a leading player in any restructuring,
as it played an important role in developing Chemoils initial
U.S. operations to its current global scope, Adair said.
Postponed Opening
The company postponed the official opening of its Singapore
oil storage facility indefinitely after the fatal crash, Chemoil
said in a separate e-mail today. Chandran was 57.
The opening of Helios Terminal Corp. on Singapores Jurong
Island was scheduled on Jan. 10. The unit, which has yet to start
operations, has a capacity of 448,000 cubic meters with 18
storage tanks.
Born in Mumbai on May 31, 1950, Chandran immigrated to
California in 1976, began trading fuel in 1981 and started
Chemoil in 1982. The company had its initial public offering on
the Singapore Exchange in 2006.
“Dont become an entrepreneur to make money, but be one
because you want something you enjoy doing. That way, you will
ultimately make money, Chandran was reported as saying by The
Straits Times after winning the Ernst %26amp; Young 2007 Singapore oil
and gas entrepreneur award. “Otherwise, its going to be a pain
in the butt.
Forbes magazine has estimated his net worth at $490 million,
making him no. 14 on its list of Singapores 40 richest people
last year.
To contact the reporters on this story:
Sophie Tan in Singapore at
