SINGAPORE - Like a cat with nine lives, Hyflux has managed to fend off a bid by seven banks to start the legal process for having the troubled firm placed under judicial management.
The High Court ruling on Tuesday evening (May 7) also extended the deadline for Hyflux's debt moratorium with its creditors from May 24 to May 29.
High Court Justice Aedit Abdullah said he "won't make any order (today)" on whether the seven banks, which collectively hold $648.7 million of debt, will be allowed to start an action to put Hyflux and its Hydrochem Singapore under judicial management.
But Hyflux was left under no illusion that it is on borrowed time.
Justice Aedit told its lawyer that he will "leave a sword hanging over (the firm's) head", adding: "I will be keeping the company on a tight leash, given that we have been at this for quite a period of time."
Hyflux makes its case for extending the debt moratorium on May 29 but Justice Aedit was clear that it will not get an easy ride.
"A moratorium is meant to be a temporary institution to allow a company to put something together... but it doesn't mean I can give a blank check for the moratorium going forward," he noted.
"The moratorium is not likely to be as long as it used to be and I would attach conditions."
These include "disclosure of running costs of the company, including all of its restructuring efforts, and there be a timeline given to me of the expected completion of restructuring effort, leading up to a possible scheme application and some assurance of continuing engagement with various creditors", Justice Aedit said.
The seven banks could still start an action for judicial management if Hyflux fails to make further headway in its restructuring efforts.
Hyflux is racing to nail down a $400 million rescue deal with Utico, the largest utilities provider in the United Arab Emirates.
Last month, it aborted a $530 million deal with Indonesian consortium SM Investments and is now fighting to claim a $38.9 million deposit from the entity.
If the banks had prevailed on Tuesday, they could have asked the court on May 13 to place Hyflux and Hydrochem Singapore - its engineering, procurement and construction business - under judicial management. That court date has now been cancelled.