Everything About the oBike’s Alleged Transfer of $10m Away Before Shutting Down

2018-08-03 , 5:19 pm

The plot just thickens in the latest episode of the oBike saga. In fact, I won’t be surprised if this is being adapted into yet another Hong Kong drama; ironic because the setting is in Hong Kong as well.

Before anything, a recap (scroll down a bit more to skip the recap: we’re not Netflix whereby you can just click on a button to siam recap).

Previously, on the oBike saga

oBike shut down suddenly, a liquidator is engaged for creditors and hopes of refunds were as slim as our fat boss passing his IPPT. And now, a new revelation has brought in the second season of the oBike saga: $10 million has allegedly being transferred to oBike Hong Kong before oBike Singapore shut down, so it’s one heck of a story because the total amount owned to oBike Singapore users is $8.9 million (i.e. enough to refund).

And if you’re confused (what oBike Singapore what oBike Hong Kong?), here’s an explanation of everything simplified for you, because not everyone can understand those business jargon (my colleague just asked me if liquidator is a machine that turns solid matter into liquid).

Think of a Company like oBike as a Robot

Imagine that oBike Singapore is a robot – what does it need? It needs a person to control the robot and a person to buy (and therefore own) the robot.

Now, if the robot decided to do an I, Robot and starts eating people, it’s gone rogue. Usually, who do you blame first? The person who controls the robot.

With that in mind, here’s a breakdown of how oBike can fit into this analogy:

Robot = A company (oBike Singapore)
Person who controls the robot: Director (a person)
Person who owns the robot: Shareholders (people)

If you want to sue the robot for eating your pet’s food, you sue the robot, not the director or shareholders. If the robot owes you money, you get it from the robot, not the director or shareholders.

That is one of the reasons why people start a company: it’s to clear them of all liabilities.

Read on because it’s getting more exciting.

oBike, the Robot That Cannot Suddenly Shut Down

We all know what happened earlier: the robot wants to shut down. While it is a robot, it could be a bigggggg robot: a robot with a basket of money, debts, emotional baggage or whatever.

When people who control or own the robot decides to shut it down, it can be “struck off” – but before that, there must be no objection. It cannot suka suka just shut down because it might still own people money, or it needs to attend a court hearing, or an ex-robot-girlfriend isn’t happy (the last one’s a joke).

If the robot tries to shut down, it can’t just turn a switch: it has to stand in the middle of a street and let everyone knows that it’s going to shut down. If anyone objects with a reason (e.g. it has eaten your pet’s food and hasn’t returned you money), it can’t be shut down: that has to be resolved.

If no one objects, the robot can be disassembled.

But oBike? Think it can be struck off?

Nope, of course not because it’s so big with so many creditors.

Instead, it must be wound down.

oBike, the Robot That Has to Go Through Liquidation

Liquidation is a chim word, so let’s go back to the robot.

So, the robot cannot function anymore for some reason (electricity too expensive to maintain the robot: we feel you). Why not just shut down by itself? Well, it can so do if it doesn’t own anyone money: it’s called a solvent company liquidation, whereby the robot is disassembled, and the spare parts given evenly to the shareholders, depending on how many % they own.

But oBike has debts: it’s not just you who has refunds with them. According to reports, they also owe other companies money, and that figure can go up to six figures. So, to put it simply, the robot has to be disassembled, the spare parts sold for money and the money would first be given to the creditors before the shareholders (if there’s any left lah).

The Revelation That Revives the oBike Saga

It’s reported that before oBike the robot shuts down, it allegedly disassembled itself (now, remember: during that period, the robot is still functioning normally) and send “spare parts” to another robot called oBIke Hong Kong.

Therefore, when oBike Singapore shuts down, it has nothing left: nothing much can be done.

Now you know what people are angry.

Why Not Get Money Back from oBike Hong Kong?

The question is, How? Remember, oBike Hong Kong has its own directors, shareholders and whatnot. Of course the question of whether the directors and shareholders are similar people is a different story altogether.

It’s essentially another robot altogether.

No one can touch or control oBike Hong Kong except its directors / shareholders after all.

Of course, some companies even pay its directors (or shareholders) all their money and shut down with many creditors: that’s even worse, isn’t it?

What Does the Liquidator Say?

Fun fact for my colleague who thinks that liquidator has something to do with water: a liquidator is the person who disassemble the robot, sell the spare parts for money and return the money to creditors (then shareholders).

FTI Consulting is the liquidator in this case, and here’s what the company’s senior managing director says: “Some of the transactions are inappropriate given the financial position of the company, and we will be looking at those a lot further…We can look at unwinding that transaction to say ‘no, you do owe the money to oBike Singapore and you need to pay the money to oBike Singapore’, that’s what we have communicated.”

But what’s even more saga-ly is this: oBike Singapore users have so far filed “hundreds of thousands of dollars” worth of claims, but these are the people who have filed the claims…i.e., put themselves forward as a creditor. The Hong Kong office proposed to pay for them, but the liquidator rejects that.

Reason being? The total oBike Singapore owes is $8.9 million. It’s like offering to refund only people who has made noise.

What’s Next

Remember the director thingy, i.e. the controller of the robot?

Here’s what the liquidator says: “Even though he (Shi Yi) was not a director on record, my understanding is that he did have a lot of control over the Singapore operations. We have told Shi Yi that there has to be a process followed and he should refund the monies, and ensure everyone has an opportunity to file their claim.”

Of course, we’re all wondering: Where’s the real director on record?

I bet the next season is going to be as exciting.