Hyflux confirms no binding agreement with potential investor Utico
Ahead of today's High Court hearing on whether Hyflux will get a further reprieve from creditors, the beleaguered company clarified yesterday there is no binding agreement with potential investor Utico and that their talks last week "entailed no conclusive numbers or percentages" for its junior creditors.
The clarification, made in a statement to the Singapore Exchange yesterday, came after the United Arab Emirates utility's overtures to some 34,000 retail perpetual securities and preference (PNP) shareholders on Sunday.
Utico, which has offered to invest $400 million in the debt-ridden water treatment firm, offered the junior creditors "part cash redemption and also a hope for full redemption with a plan and exit option".
The junior creditors are now trying to recover around $900 million that they had invested in Hyflux.
"Full details can only be revealed later, but... small investors of up to $2,000 to $3,000 could get 50 per cent cash redemption along with full redemption opportunity, while the rest of the investors could get a similar, but staggered and cascade deal," Utico chief executive Richard Menezes said on Sunday.
When asked by The Straits Times why Utico is offering to help the junior creditors even though their votes are not needed for its offer to be accepted, Mr Menezes said: "We are white knight investors.
"Water and utilities are based on public necessity and should be based on ethics too... They (PNP investors) cannot be ignored whether they have votes or not. It is ethical."
But Hyflux clarified that the discussion at last week's meeting was "focused on high-level views which entailed no conclusive numbers or percentages, or indeed any binding agreement, whether in respect of the PNPs or any other stakeholder groups".
The company and its advisers understand that Utico's statements are "exploratory in nature and are approaches currently contemplated by Utico". - THE STRAITS TIMES
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