Investor body SIAS says Utico is making last-minute changes to Hyflux deal

People gather during a protest on Hyflux Ltd. debt restructuring plan in Singapore on March 30. Photographer: Bryan van der Beek/Bloomberg

The Securities Investors Association (Singapore), or SIAS, has urged United Arab Emirates-based utility firm Utico FZC and Singapore’s indebted water treatment firm Hyflux Ltd to continue negotiating a deal that could see the latter securing S$400 million ($294 million) from the Middle Eastern investor.

SIAS founder and CEO David Gerald on Wednesday issued a statement noting that SIA has been closely monitoring the progress of the negotiations between Hyflux and Utico in the last few months and the group is “seriously concerned” that there is no finality yet on Utico’s offer.

Some deals, Gerald alleged, have been “repeatedly introduced at the eleventh hour” by Utico even as Hyflux and the various creditor groups have been working to try and work out a deal acceptable to everyone.

Gerald said the negotiations must aim to achieve a “commercially acceptable outcome” for all stakeholders involved, including those who hold perpetual securities and preferences shares.

“SIAS hopes that such strategies designed to achieve advantages for one party only would not be allowed to scuttle an outcome which could potentially benefit a great number of stakeholders,” the SIA head said.

Utico and Hyflux started negotiations in May, a month after the Singapore firm received a non-binding letter of intent from the Middle East company for a possible injection of S$400 million in exchange for an 88 per cent stake.

Hyflux’s attempt at restructuring S$2.8 billion of unsecured claims, one of the largest such cases in Singapore in recent years, was thrown into disarray on April 4 when it scrapped a pact with its would-be saviour SM Investments, according to a Reuters report.

The Singapore firm, which is under a court-supervised restructuring process, was once considered a national champion running a strategically important water source for the city-state.

In August, Utico said it agreed to a deal with Hyflux, the last day before an exclusive discussion agreement ended. But Hyflux said no definitive restructuring deal has been reached yet.

Utico, based in the United Arab Emirates, is the largest private full-service utility and developer in the Middle East. Its shareholders and investors include the governments of Oman, Saudi Arabia, Bahrain, and Brunei.

“Given the substantial amount of time, effort and resources invested by all the stakeholders, SIAS urges all parties, including the investor to continue negotiations,” Gerald said in a statement.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.