Hyflux in talks with new white knight investor for a $400 million injection

Hyflux said on April 25 that it will use a possible $400 million investment for equity and working capital purposes, as well as possible urgent interim funding.
Hyflux said on April 25 that it will use a possible $400 million investment for equity and working capital purposes, as well as possible urgent interim funding.PHOTO: ST FILE

SINGAPORE - Troubled water treatment company Hyflux is in talks with a new white knight investor - one that may provide Hyflux with $400 million.

Hyflux called the potential white knight in an exchange filing on Thursday (April 25) "a developer and owner of water and power utilities based in the Middle East with a reputable track record". No other details are known for now.

The money will be used for equity and working capital and possible urgent interim funding. The white knight has issued Hyflux with a non-binding letter of intent, the filing noted.

Hyflux is also engaging with other potential overseas investors on their interest in its business and assets, including parties "that would have synergy with" Hyflux, it noted.

Hyflux will provide updates to its debt moratorium that will expire on April 30, the filing added. It has asked the court for a three-month extension in a meeting on April 25. 

Earlier this month, Hyflux terminated a rescue deal with Indonesian consortium SM Investments, led by billionaire Anthoni Salim, that would have injected $530 million into Hyflux. On Monday came news it had a new plan to avoid liquidation that would also be a better deal for its aggrieved 34,000 retail investors, who are owed $900 million.

As of March 31 last year, the water firm had debts totalling $2.95 billion.

Meanwhile, a group of unsecured banks are seeking leave from the High Court of Singapore to file applications for Hyflux and its subsidiary Hydrochem to be placed under judicial management and/or interim judicial management, Hyflux said in the same filing on Thursday.

 
 
 

These banks are Mizuho Bank, KfW IPEX-Bank GmbH, Bangkok Bank Public Company, BNP Paribas, CTBC Bank, The Korea Development Bank as well as The Korea Development Bank Singapore Branch. They applied on April 24 to the High Court of Singapore to vary the debt moratoriums currently in force in respect of Hyflux and Hydrochem.

Judicial management is a rescue procedure to restructure a distressed company's debt. An independent judicial manager is appointed to take control of the company's affairs, business and property, in an attempt to help it survive, get a scheme of arrangement approved or a more advantageous realisation of the company's assets versus that in a liquidation.