SINGAPORE – The Securities Investors Association (Singapore) (Sias) is seeking an update on debt-ridden water firm Hyflux’s restructuring.
In his latest media statement on Saturday (Sept21), Sias chief David Gerald said the investors’ rights advocacy group is “fully supportive” of the company’s request for a two-month extension to facilitate negotiations with potential white knight Utico with a view to finalise and execute the proposed restructuring agreement.
On Sept 19, Hyflux and three of its subsidiaries applied to the court to extend their debt moratorium by another two months until November. The applications will be heard in court on Sept 30, when the previous extension expires.
In August, Hyflux said that a definitive agreement for the rescue deal had not been entered into with Utico, pending resolution on “certain final outstanding issues” in the draft definitive agreements.
Utico had earlier agreed to take an 88 per cent stake in Hyflux through a $300 million equity injection and a $100 million shareholder loan.
Mr Gerald said on Saturday that should a deal with Utico not be reached, the further two-month extension on the moratorium will also allow Hyflux to pursue discussions with the other interested investors.
The creditors are still able to apply for leave to bring an end to the debt moratorium if they are not satisfied with the progress of negotiations. “Sias agrees that there will be no prejudice caused to the creditors,” noted Mr Gerald, who has written several open letters and opinion pieces on the drama unfolding at the former market darling.
At a Sept 16 meeting, Hyflux directors updated Sias on the efforts undertaken by the company to secure an investor. Sias is “encouraged” by Hyflux’s efforts in its negotiations with potential investors and the progress achieved with Utico, Mr Gerald said.
During that meeting, Hyflux also informed Sias of the reasons why the company would not be applying for leave to convene a scheme meeting this week as previously intended. Instead, Hyflux applied for the two-month extension on its debt moratorium.
“Sias did impress upon Hyflux’s board to do their best to arrive at a satisfactory resolution for Hyflux’s stakeholders,” Mr Gerald said in his statement on Saturday.
Shares in Hyflux have been suspended from trading since May last year.