SINGAPORE — Troubled water treatment firm Hyflux and three of its subsidiaries have applied to the Singapore High Court for a three-month extension from its creditors on Tuesday (23 April), as it races against time to put up a plan to avoid liquidation.
It announced in an exchange filing that the application will be heard at the next case management conference on Thursday, just days before its court-sanctioned protection from creditors expires on 30 April. If successful, the debt moratorium will be extended to 30 July.
Hyflux is burdened by debts totalling nearly $3 billion as of March 2018. Last week, the Public Utilities Board issued a notice to its subsidiary Tuaspring to take over its $1.1 billion desalination plant – the heart of Hyflux’s mounting financial problems – and terminate its water purchase agreement.
Plan to avoid liquidation, keep retail investors in the books
On Monday, investment watchdog Securities Investors Association (Singapore), or SIAS, said after a meeting with Hyflux representatives that the firm is coming up with a plan to avoid liquidation and keep its retail investors in its books.
For that to happen, Hyflux said it will need at least three months in order to submit the plan to the court in an affidavit, hence the application for the three-month extension.
SIAS had requested the meeting after a $530 million rescue deal with Indonesia’s SM Investments went awry earlier this month.
About 34,000 Hyflux perpetual securities and preference shareholders are owed a total of $900 million, and a group of them staged a protest at Hong Lim Park’s Speakers’ Corner on 30 March against Hyflux’s restructuring plans and recent developments.
New claims of more than US$65 million
In another twist to Hyflux’s debt woes, it announced in its exchange filing that it is aware of claims totalling more than US$65 million (S$88 million) made by Tahlyat Myah Magtaa SpA (TMM), the project company for its Magtaa desalination plant located in Algeria.
It said that it disputes TMM’s right to make these claims and is seeking legal advice on the appropriate steps to be taken.