Newly set-up investor offers to buy out $1.8b of Hyflux's debts to noteholders, unsecured creditors

According to the invitation notice sent to Hyflux, Aqua Munda has estimated that these debts together come up to about $1.8 billion.
According to the invitation notice sent to Hyflux, Aqua Munda has estimated that these debts together come up to about $1.8 billion.PHOTO: ST FILE

SINGAPORE - In the latest twist to the Hyflux saga, a new investor set up this week is offering to buy for cash some of its debts held by the beleaguered water treatment company’s noteholders and unsecured creditors.

The company, named Aqua Munda, made its offer to holders of Hyflux's 4.25 per cent notes due in 2018, its 4.6 per cent notes and 4.2 per cent notes due in 2019, as well as to the unsecured creditors and three of the company's subsidiaries,  Hyflux said in a filing to the Singapore Exchange on Tuesday night (Dec 17).

According to the invitation notice sent to Hyflux, Aqua Munda has estimated that these debts together come up to about $1.8 billion, including some $750 million of contingent liabilities, which are those that may occur in the future.

Aqua Munda Pte Ltd was incorporated in Singapore on Tuesday, listing a registered office address on the 27th floor of Ocean Financial Centre and its main business as the manufacture of water treatment, waste treatment, and oilfield chemicals. With a share capital of $1 million, the company’s sole owner is Bambang Sugeng bin Kajairi, a Singapore citizen.

The invitation for eligible creditors to tender Aqua Munda to buy over the debts will open at 9am on Dec 30 until 5pm on Jan 10 “unless extended or earlier terminated”. 

A more detailed memorandum to set out the terms and conditions will be issued by Dec 27, the company said. Without it, it is not known how many cents to the dollar the creditors may get by selling their debt to Aqua Munda.

"For the avoidance of doubt, the investor retains the right in any event to choose not to accept any or all of the offers tendered by the eligible creditors," Aqua Munda added in its letter. It shall also "not be bound to give any grounds for the acceptance or rejection of any tendered offer".

Hyflux, which sought court protection for debt restructuring in May 2018, finally signed a $400 million rescue deal with United Arab Emirates utility Utico on Nov 26. 

WongPartnership lawyer Manoj Sandrasegara, who represents Hyflux, told The Straits Times on Wednesday: "Hyflux is monitoring the situation and it's premature at this stage to comment on how Aqua Munda's surfacing would have an impact on the restructuring without more information."

 
 
 

EY and NTan Corporate Advisory are the company's financial advisers.

In the $400 million deal with Utico, $250 million would go to settle about $1.6 billion of debt, including the unsecured creditors, contingent debt and $271 million owed to the noteholders. But Hyflux still has to seek the court’s leave to convene meetings with the various groups of creditors to get them to approve the arrangements. 

Hyflux had its debt moratorium extended by another two months until the end of January 2020, with the next hearing is scheduled for Jan 29.

In Tuesday's filing, Hyflux said of the Aqua Munda offer that it "will make the appropriate announcements as and when there are any further material developments".