TuasOne to get $23m equity injection if Hyflux seals deal with Mitsubishi Heavy Industries by end-January

The deal would allow Hyflux and MHI to commence discussions with TuasOne lenders on amendments to the project finance agreements in order for funding to continue.
The deal would allow Hyflux and MHI to commence discussions with TuasOne lenders on amendments to the project finance agreements in order for funding to continue.PHOTO: LIANHE ZAOBAO

SINGAPORE - Debt-ridden water treatment company Hyflux would see additional equity injection of $23 million from Mitsubishi Heavy Industries (MHI) into TuasOne waste-to-energy project if the two parties enter into a binding agreement by the end of January.

This was disclosed by WongPartnership lawyer Manoj Sandrasegara as he updated the Singapore High Court on client Hyflux's developments in Monday's case conference.

Hyflux and its subsidiary Hydrochem have signed a non-binding term sheet in December 2018, which is the precursor to a definitive agreement between the parties for MHI to pump another $23 million into the TuasOne waste-to-energy plant - provided that the agreement is signed by Jan 31, 2019. The deal would allow Hyflux and MHI to commence discussions with TuasOne lenders on amendments to the project finance agreements in order for funding to continue.

MHI currently owns 25 per cent in the project and is also a sub-contractor of Hydrochem.

Hyflux, which has been granted an extension of its debt moratorium till end April, has also embarked on cost-cutting measures, including returning one of its buildings to landlord Ascendas Reit (A-Reit), and is in negotiations to right-size the other two buildings in Bendemeer Road and Tuas South Lane.

Meanwhile, Hyflux is meeting its investors and other securities holders this week in a town hall facilitated and moderated by the Securities Investors Association (Singapore).