Three Arrows Capital’s (3AC) Liquidators Are Attempting to Protect The Fund’s Singapore Assets

The Straits Times has discovered that the Three Arrows Capital (3AC) liquidators are attempting to look into and protect the Singapore assets of the insolvent crypto hedge fund while 3AC’s founders, Mr. Zhu Su and Mr. Kyle Davies, are still missing.

In a chamber hearing on Friday morning (July 15), the Singapore lawyers from WongPartnership LLP for advisory firm Teneo sought an order from the High Court to recognize the British Virgin Islands (BVI) liquidation order and for Teneo’s Mr. Russell Crumpler and Mr. Christopher Farmer to carry out their duties as joint liquidators here.

The court decided to give more rights to the liquidator after receiving information that the founders of Three Arrows Capital refused to cooperate. Teneo will hold the first meeting of 3AC’s creditors on July 18.

3AC Founders are still missing

According to The Block, Teneo Restructuring is the trustee to liquidate 3AC’s assets. There have been many allegations in this unit about the “missing” of the two founders of Three Arrows Capital, Zhu Su and Kyle Davies, as well as the lack of cooperation of these two characters in the process of resolving the dialogue liquidation problem. The trustee expressed concern to the court that 3AC was trying to “buy time” to disperse crypto assets and other cash, which are highly liquid and threaten the interests of creditors.

According to Friday’s court filing, Zhu and Davies, both former traders for Credit Suisse, participated in an introductory Zoom call last week to discuss basic steps to preserve their assets. Neither founder turned on his video, and both remained muted for the duration, with all dialogue conducted through counsel. Their lawyers said at the time that they “intended to cooperate.”

During the meeting, representatives helping to facilitate the liquidation requested immediate access to 3AC’s offices and information related to their bank accounts and digital wallets. As of Friday, the filing says that access had not been granted.

When the fund’s liquidators previously arrived at 3AC’s Singapore office in late June in an attempt to meet with the founders, “the offices appeared vacant except for several inactive computer screens.”

The filing notes that while the office door was locked, the representatives could view unopened mail addressed to Three Arrows, which “appeared to have been pushed under the door or propped against the door.” Neighbors in surrounding offices said they had last seen people in the 3AC office in early June.

Meanwhile, creditors are trying to determine what assets remain.

Restructuring Proposal for 3AC

Herefore, Teneo’s side proposed to the court to allow subpoenas to summon founders Zhu Su and Kyle Davies, as well as give them the right to seek information about the current status of Three Arrows Capital. The liquidator claims to have received requests for information from various entities linked to the investment fund but needs a court order to legalize the action. If Teneo’s lawyers are successful, Teneo would be able to secure Three Arrows’ assets in Singapore for the hedge fund’s creditors.

Judge Martin Glenn of the United States District Court for the Southern District of New York approved Teneo Restructuring’s proposal and gave it the right to manage Three Arrows Capital’s assets in the US, meaning it would freeze those assets.

The first meeting of the creditors of Three Arrows Capital will be held on July 18, chaired by Teneo.

The content of the meeting may revolve around the establishment of a council to represent the interests of the creditor, as well as the announcement of the liquidation process. Teneo has set up a website to provide information to the creditors of Three Arrows Capital and will publish the information here.