Hyflux says no definitive rescue deal reached with Utico

SINGAPORE - Hyflux on Wednesday night (Aug 28) clarified that a definitive agreement had not been entered into with Utico, pending resolution on "certain final outstanding issues" in the draft definitive agreements.

The embattled water firm was responding to media reports over a statement Utico, a United Arab Emirates utility firm, released on Tuesday stating that it had "signed and released" a restructuring agreement with Hyflux.

"The company and Utico are however in highly advanced discussions and will continue to engage with each other with a view to resolving such final outstanding issues and finalising and entering into the definitive agreement as soon as possible," Hyflux added in its statement issued just before midnight.

In its statement on Tuesday, Utico said the restructuring deal "finds a resolution" for creditors and PNP investors and development projects that have been "languishing since the moratorium" in May 2018.

It also added that "swift action" would be taken to bring all projects up to speed, as well as take on new projects, together with the support of Hyflux's board and management. Any details of the agreement were not disclosed.

When contacted by The Business Times on Tuesday, Hyflux said that an announcement would be made in a filing with the Singapore Exchange. But no announcement was forthcoming as at press time that day.

Hyflux on Aug 16 said it would engage exclusively with Utico until Aug 26, as its negotiations were the most advanced among all potential investors.

 
 

This date was also the deadline for Hyflux to enter a definitive agreement for Utico's intended investment - a $300 million equity injection and a $100 shareholder loan for 88 per cent of the water firm.

Once a home-grown success story, Hyflux collapsed last year under the weight of a debt pile of nearly S$3 billion, forcing it to seek court protection and embark on a search for a rescuer that has taken many twists and turns. Its flagship Tuaspring desalination plant was taken over in May this year by national water agency PUB. 

About 34,000 small investors who bought the company's perpetual securities and preference shares are owed a total of $900 million. Utico chief executive Richard Menezes said in May that the firm was offering these investors "part cash redemption and also a hope for full redemption with a plan and exit option".