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Hyflux
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laksaman57
Supreme |
10-Apr-2019 11:36
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When buying bond, best audio record your discussion with bank financial advisers, just like bank record your conversation during phone banking | ||
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Starship
Supreme |
10-Apr-2019 10:24
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Don' t blame Singapore investors for Hyflux loss 10/04/19, 07:27 am If success has many fathers, failure in financial markets is no orphan either: It almost always ends up in the lap of retail investors. In Hyflux, there are 34,000 of these moms and pops, set to lose most &ndash if not all &ndash of the $900 million they plonked down in the troubled Singaporean water and power firm&rsquo s preference and perpetual shares. Those securities are in dire straits after Hyflux last week scrapped an accord with SM Investments. The closely held venture of Indonesian tycoons Anthony Salim and Arifin Panigoro had agreed last year to infuse $530 million to rescue the cash-strapped Singapore firm in exchange for a majority stake. The white knight was at least offering to pay the junior debt holders 10 percent with SM departing and liquidation looming, the perpetual securities are trading below 5 cents on the dollar. This is the way capitalism works, the aggrieved investors are being reminded. Their demand that the Singapore government should step in has been a nonstarter, even after some of them even organised a rare protest at the city&rsquo s Speaker&rsquo s Corner to try to squeeze out a better deal. I supported nationalisation last year because of the strategic importance of Hyflux&rsquo s Tuaspring desalination plant to the island-city that lacks enough fresh water of its own. But the moment has passed. Why saddle taxpayers with liabilities when the desalination asset can be theirs anyway, minus an accompanying power-generation unit? (The 411-megawatt plant, which bled in an oversupplied electricity market, has been the key reason behind the firm&rsquo s unraveling). Singapore&rsquo s water agency PUB has said it will take over the desalination unit at zero cost, and tear up the water purchase agreement with the private firm, if defaults aren&rsquo t resolved. Investors are only human, so they need to blame someone or something &mdash such as the ATM for letting them buy Hyflux&rsquo s junior debt with a couple of easy clicks. But there aren&rsquo t many voices of sympathy. Stefanie Yuen Thio, a prominent city lawyer cited by the Business Times, says the real problem is that while &ldquo Singapore' s securities market has grown in sophistication and complexity, the Singapore retail investor has not kept up.&rdquo Naivete, though, is only a part of the story. The fact that the securities are unrated gets a lonely mention at the end of page 19 in the 2016 offer document. By contrast, the information that the perpetuals can be ordered on an ATM, and via web and mobile, adorns the front page. The low-rate environment, too, made mistakes inevitable. The 2016 Hyflux perps promised a 6% coupon, when 30-year Singapore government bonds yielded 2.5%. It promised a step-up in 2020 in case the four-year Singapore dollar swap offer rate rose as global interest rates normalised. How many retail investors even know what that benchmark is? " Due to very low rates and yields in the past five years, Singapore investors, both institutional and retail, have sometimes opted for riskier bonds to increase cash returns,&rdquo says S& P Global Ratings analyst Bertrand Jabouley. In an ageing society like Singapore, it&rsquo s not uncommon for retail investors to have targets for cash returns. The Monetary Authority of Singapore told Bloomberg News that it hasn&rsquo t uncovered any impropriety by DBS Group Holdings, the city&rsquo s biggest bank that arranged the sale of its securities in May 2016. &ldquo All investments carry risks,&rdquo the MAS said. They sure do, and risk factors mention them. &ldquo The Group is a new entrant to the power business,&rdquo says page 35 of the Hyflux offer document. But is that a fair warning for a S$916 million asset impairment in the first nine months of 2018? Hyflux was a homegrown success. Temasek Holdings, the state investment firm, had a stake in it in the early 2000s. &ldquo Local companies with strong capabilities are building, expanding, gaining a march on their competitors, like Hyflux,&rdquo Singapore Prime Minister Lee Hsien Loong said in his national day rally speech in 2009. In 2011, CEO Olivia Lum became the first woman to win the Ernst & Young World Entrepreneur of the Year award. She did business in Algeria, Saudi Arabia, Egypt and Oman. Nobody is denying those successes. But Hyflux shouldn&rsquo t have been allowed anywhere near yield-starved Singapore retail investors in 2016. S& P says that &ldquo numbers at that time already suggested that the company' s capital structure was hardly sustainable, with a ratio of net debt to Ebitda above 10x in 2015 and negative Ebitda in 2014, driven by performance issues at the company' s Tuaspring desalination and power plant.&rdquo The loss may be investors&rsquo to nurse, but neither their gullibility nor greed is entirely to blame for it. https://www.theedgesingapore.com/dont-blame-singapore-investors-hyflux-loss-andy-mukherjee |
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laksaman57
Supreme |
10-Apr-2019 10:11
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All depends on their definition of impropriety mah | ||
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dc_rw73
Member |
10-Apr-2015 15:48
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If Tuaspring is a toxic asset as claimed, then isn't it was selling a toxic financial product to the retail investors? Then how can MAS see no impropriety by DBS in Hyflux bond sale? | ||
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laksaman57
Supreme |
09-Apr-2019 23:44
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http://redwiretimes.com/singapore-in-brief/retail-investor-watchdog-questions-pub-on-600-percent-price-mark-up-for-water-sold-to-consumers/ | ||
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Stephenchow
Veteran |
09-Apr-2019 20:29
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Twitter CEO Jack Dorsey received a total salary of $1.40 in 2018, the social media company said Monday in a Securities and Exchange Commission filing. Dorsey did not receive any other compensation or benefits from the company, according to the filing. He also allegedly declined all compensation and benefits in 2015, 2016 and 2017. " As a testament to his commitment to and belief in Twitter' s long-term value creation potential, our CEO, Jack Dorsey, declined all compensation and benefits for 2015, 2016 and 2017, and in 2018 he declined all compensation and benefits other than a salary of $1.40," a section of the filing reads. |
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Stephenchow
Veteran |
08-Apr-2019 22:50
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$3b = S$3,000,000,000, if put in Fixed deposit at 2% interest = S$60m or $S60,000,000 interest every year = strike 6 times 10million TOTO every year or every 2 months strike one time $10m TOTO, some more capital protection, worry free and tax free. More importantly is no need to face the Wayang & Hypocrite gov officials every few days asking you to drink coffee with them With Indo vomiting blood, malaysian banker falling into the drain, now the only hope is flash with cash ah Tiong but a number of them would not want to be in limelight for their questionable income, so no much hope already |
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Starship
Supreme |
08-Apr-2019 16:18
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SIAS should give it' s Most Transparent Company Award to ....................DBS....................  MAS sees no impropriety by DBS in Hyflux bond sale MON, APR 08, 2019 - 1:41 PM Singapore' s financial regulator said it hasn' t uncovered any impropriety by DBS Group Holdings Ltd in arranging the sale of securities by troubled Singaporean water and power company Hyflux Ltd in 2016. DBS, South-east Asia' s biggest lender, complied with regulatory requirements as both manager and distributor of the perpetual securities, the Monetary Authority of Singapore (MAS) said on Monday in a reply to Bloomberg questions. Hyflux last week scrapped a pact with its would-be saviour SM Investments Pte after disputes. The group of Indonesian businessmen agreed last year to rescue Hyflux in return for a majority stake, and the development prolongs the plight of about 34,000 retail investors who stand to lose almost everything. " As the issue manager, DBS conducted due diligence checks to ensure that material information relating to Hyflux was highlighted in the offering document," the MAS said. While distributing the bonds via its automatic-teller machines, the bank also reminded investors to read the disclosure documents before making their applications, the regulator added. " All investments carry risks," the MAS said. " The deterioration in Hyflux' s financial conditions that led to losses for investors illustrates this." 
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TA_Expert
Supreme |
08-Apr-2019 14:06
Yells: "The World has changed" |
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Looked at MAS' s position on this case. It is a buyer beware market, echoing SIAS. https://www.businesstimes.com.sg/companies-markets/singapore-financial-regulator%C2%A0sees-no-impropriety-by-dbs-in-hyflux-bond-sale |
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fundamentalhero
Veteran |
08-Apr-2019 03:10
Yells: "I NEED HONEYS AND MONIES" |
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The below message is not just for Midas fraud victims but also any and other victims of S-chips and various fraudulent companies.
I hope that fellow victims of S-Chips and various frauds committed by companies listed on SGX can rise up and finally muster some guts and courage to voice out the issues be it through email or any other means however small and tiny effort it may be to get the relevant parties to act on and frankly protect the financial system in a rigorous way and not being the current way it is now. Personally I have sent the following email with regards to Midas fraud case and I hope midas victims do what little struggle you can put up now in face of pure fraud, to speak up and those who are really interested do private message me your contact details so we can arrange a meet up with fellow midas victim group. Hopefully Midas pure fraud case can be the guiding light to all s-chip frauds and bring reprieve and closure to victims in form of getting authorities to act and having conclusive and effective results like clawing back any or every sum of defrauded/siphoned/embezzled monies and re-distributing it to TRUE victims of the fraud (lest those fraudsters b.o.d who continue to hold interests in the company) To: [email protected] < SGX > consumers@mas [email protected] [email protected] [email protected] [email protected] < [email protected]> [email protected] [email protected] Jackson Toh [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] Jacqueline WEI (SPF) [email protected] [email protected] [email protected] [email protected] Subject: Re: Ref # SGX-684554-C8L7K6 Re: 麦 达 斯 股 民 请 愿 书 [External] Dear Ministers, Media and Fellow Victims of Midas Fraud Case,
Following SGX' s and Mr. Chan Soo Sen( who have worked tirelessly on this case given the restricted resources and assistance provided) April' s announcement of Midas very possible delisting due to extreme circumstances caused by the by both " CRRC and China' s liquidators (lack of transparency and respect of other sovereign laws) and previous (pure fraud committed)" board of directors, I am appalled at the level of inaction taken by MAS, SGX and CAD, whether it be on the investigations (being that there were no visible nor constructive results/solutions/persecution despite the obvious fraud crime that had happen and also that non of the mentioned agencies have came out to calm victims of this fraud case or to give assistance!)
So Much for the talk of showing appreciation for merdaka generation or pioneer generation!!!
There are many elderly victims who are sufferers of this fraud case who are being " shown appreciation" from the zilch response and non-existent assistance provided by the mentioned agencies!
However, the main reason of this email is to not just make known the high level of inefficiency in MAS,CAD and SIAS ( especially when tackling MIDAS Fraud Case - where there has been very apparent fraud and trails to follow but zero results shown), but actually to demand the relevant agencies, authorities and organisations who are involved/investigating/in-charged-of in MIDAS FRAUD CRIME, to come together to salvage what little reputation remains (through providing direct assistance to victims to seek reprieve) by protecting MIDAS LTD LISTING (thereby repudiating/rejecting any claims and all calls for it to be delist) till there are conclusive results/persecution/remedies (clawing back of assets and monies for the affected victims and effectively denying the rights to the repatriated monies from those who were involved with the fraud - Midas B.O.D)
" In response, Commercial Affairs Department (CAD) and Monetary Authority of Singapore (MAS) and Singapore& rsquo s regulatory unit SGX RegCo issued a joint statement on Monday saying their investigations will continue regardless of the application to wind up Midas."
What good does it do should Midas be wound up and that there be conclusive results?!? By then through the different and various layers of corporate laws and transactions trails, the misappropriated monies will be long absconded and the monies be fully " washed" through the usual money laundering means of placement,layering and integration!!!!
The only beneficiaries by then will only be you guys [MAS, SIAS, SGX and CAD] who will jump out to proclaim " victory" against financial fraud with no basis and reprieve and the ultimately victims of MIDAS FRAUD will not only not be able to see conclusive results from monies clawed back and distributed accordingly to the shareholdings, MIDAS FRAUD VICTIMS will by then SUFFER being EXPLOITED by the above agencies of " their success" with no-real conclusive results!!!!!
From the first discovery of the Fraud, The parties [SGX, Mazars, SIAS and MAS] should have had issued a moratorium/stay on any sort of financial activities by Midas and its Subsidiaries, when for most of the time these agencies boast of their efficiencies and strong reputation and governance!!!!
Yet it was not done DESPITE the huge sums being reportedly misappropriated.
Thus it is not wrong that many investors' opinions (myself included) whose views are that while it was the B.O.D who have had committed the fraud, SGX,Mazars, SIAS and MAS are of equal culpability for the lack of enforcement/regulating despite many prior warnings [Mazaars, SIAS, SGX, CAD and MAS] or the direct and indirect abetting of Midas B.O.D Fraud [SIAS frivolous giving of Midas " Most Transparent Company Awards" (paid or unpaid), Mazars issuance of unqualified opinion of 4 years of audited accounts and SGX approval through non executing of further checks despite having the authority and powers to exercise such checks on raised issues of the accounts as with many S-Chips Fraud (Yamada Green Resources, China Fishery, Sino-Grandness and even NOBLE and ABL SAGA!!)
For the extended amount of time that we have all waited (till the extent one of the elderly victim has passed away [Rest In Peace Francis] without any reprieve of this Fraud Case), the only thing that is visible to all the 15000++ Midas Fraud Victims is the level of Inefficiency of the Government Organisations [MAS, CAD], Semi-Government Organisation {SIAs] and " Private Organisation" [SGX,Mazars LLP, Midas Previous B.O.D]
We (who have been communicating with the relevant agencies for the past 1.5 years ++) are totally disappointed with the level of governance of the various organisations mentioned above where it seems that the stated organisations is not only inefficient in dispensing of their core and fiduciary duties but have also directly/indirectly contributed extensively to Midas Fraud Case Namely [The hired Auditors and Mazars LLP, SIAS and SGX (thereby MAS) along with the " protagonist" Midas B.O.D]
On Behalf of the 15000++ Midas Fraud Victims, I ask and demand that the above agencies/authorities/ministers-in-charge ,(having neither issue a moratorium or the like nor a stay along with mareva injunction against the perpetrators " aka protagonist MIDAS B.O.D" nor the like, which arose from the high level of inefficiencies despite constant proclamation otherwise), that you act to repeal/reject/repudiating all financial claims/delisting notice and procedures and the like to maintain MIDAS LTD listing throughout and till there are conclusive results/persecution/remedies (clawing back of assets and monies for the affected victims and effectively denying the rights to the repatriated monies from those who were involved with the fraud - Midas B.O.D)
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ysh2006
Supreme |
07-Apr-2019 18:18
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Just like somebody didn't meant to choose a party but don't how during GE crossed it once chosen need to wait 5 yr than can change for this case maybe no chance already to change like marriage the rice is cooked.
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Stephenchow
Veteran |
07-Apr-2019 15:05
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Bkng595
Member |
06-Apr-2019 11:28
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May be 20/20 vision, given all the info disclosed publicly in recent months the cash flow prob and TS prob has been obvious since 2017 The question is why the coy did not disclose timely and did not say when they issued the perp etc. Why KPMG did not know when they Blessed the 2017 accounts? Did they know?..... Also, the coy allowed to book paper profit during construction of the TS, ie even before TS start operation. Is this proper accounting? May be, if there was no profit during TS construction, no perp would have been issued and no div would have been paid.........bod, banks, auditor, public etc would discover the prob earlier....may be the mess would be a lot smaller ...........sigh
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laksaman57
Supreme |
06-Apr-2019 10:38
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Bank's tops must be held accountable. | ||
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Starship
Supreme |
06-Apr-2019 09:27
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More twists and turns in this story than the longest HK Drama series " A Kindred Spirit" (真 情 ) with 1128 episodes................................   Hyflux rescue bid by SMI falls through amid conflicting statements 06/04/19, 07:41 am SMI flags non-disclosure of material issues The cracks were apparent in the deal at least a fortnight earlier, as seen from a series of exchanges between both parties. &ldquo SMI has been waiting for Hyflux to disclose further material information following multiple requests for such disclosure. The delay in disclosing this material information has prevented SMI from determining a workable allocation between working capital and the settlement amount to creditors under the Restructuring Agreement,&rdquo the SMI announcement of April 4 says. &ldquo As noted previously, SMI has already issued [to] Hyflux two notices to remedy threats to the Tuaspring and Magtaa projects on March 18 and 25 respectively. These threats have not been remedied,&rdquo states SMI. The Magtaa project is in Algeria. On Dec 25, 2018, Hyflux received a notice threatening termination by Feb 8 this year from the offtakers in relation to the water purchase agreement at the Magtaa Desalination Plant. The offtakers alleged certain defaults under the concession agreement. But this was only disclosed to SMI on March 18. Besides the existing problems at Tuaspring and Magtaa, SMI said on April 4 it was informed only on April 3 of &ldquo a threat to a third major project&rdquo . SMI did not name the project, but in the same late night statement, Hyflux said the third major project referred to SingSpring Trust, of which it owns 30%. Keppel Infrastructure Fund Management, which holds the remaining 70%, has &ldquo buyout rights&rdquo to this project Hyflux has assured its partner KIFM that SingSpring won&rsquo t be affected by the restructuring deal. &ldquo Accordingly, there is no &lsquo threat to a third major project as asserted by the Investor,&rdquo Hyflux said. SMI insists it has complied with the restructuring agreement and is taking legal advice in relation to the action taken by Hyflux. In addition, on March 5, PUB announced that it had issued a default notice to Tuaspring and had extended the time period for Hyflux to remedy the default to April 30. Are perpetual securities too sophisticated for retail investors? The big boys are not the only ones asking questions. Many PnP investors are voicing concern over the way in which the retail tranche of perpetual securities was sold. At the demonstration, a retiree said she was told water is a necessity and a defensive sector. The risk of this investment was also pointed out in a letter to the Business Times, which said that &ldquo financial analysts of the financial institutions who sold the perpetual securities should have anticipated the financial risks to unsophisticated CPF investors when the securities were issued in 2016&rdquo . The letter also pointed out that the proceeds of the 2016 issue were used to redeem older perps that had been issued to accredited investors. &ldquo The Monetary Authority of Singapore should look into the financial analyses and selling processes of the financial institutions and ask why they chose to sell the new issue to unsophisticated investors when the financial health of Hyflux had deteriorated in 2016 compared to 2014,&rdquo the letter said. DBS Bank is a key player in this whole episode. It was the sole manager and book runner for both the 2011 tranche of preference shares and the retail tranche of perpetual securities. When asked whether it took due care in bringing the retail perpetual securities to market, a DBS spokeswoman says the bank certainly did. In fact, financial institutions do not actually market retail products. It is up to the retail investor to buy the product through the ATM. &ldquo There are different and strict guidelines on the availment of bonds/perps to retail investors laid down by SGX and MAS. These guidelines are stricter than the processes for bonds targeted only at institutional and accredited investors,&rdquo says the DBS spokeswoman. &ldquo Retail bond issuances are also subject to additional clearances by the authorities. With any retail bond taken to market, DBS adheres to all guidelines and regulatory requirements, including processes to comply with the added regulatory disclosure requirements when the retail bond is sold with a prospectus/offer information statement. &ldquo The perpetual securities were taken out to market with disclosures that were in compliance with legal/regulatory requirements and market best practices as advised by external professional parties, including legal counsel appointed for the issuer and the arranger respectively.&rdquo Interestingly, banks continued to extend loans to Hyflux after the issuance of the perpetual securities in May 2016, indicating that they too must have done detailed credit analysis, a banker says. Financials point to stress in 2015 Now, Hyflux&rsquo s financials, based on information readily available in the public domain, can already be interpreted as stressed in FY2015. For instance, total dividends paid for FY2015 were $69.19 million, of which $13.35 million was paid to its ordinary shareholders. In 2015, Hyflux had 785.28 million ordinary shares. The dividend payout ratio would be 31%, based on Hyflux&rsquo s net profit of $42.15 million for that year. It appears that the remaining monies were paid to preference shares and perpetual security holders. If these distributions had been reclassified as interest expense, Hyflux would have reported a significant net loss, thereby dissuading retail investors from investing in the retail perpetual securities when they were offered. What happens next? Hyflux says it will &ldquo relentlessly pursue&rdquo other viable opportunities. David Gerald, president and CEO of the Securities Investors Association (Singapore), urges creditors and stakeholders to be patient, and to give Hyflux the time and space to work out an alternative. However, just like how water is accorded value because of its scarcity, time and space for Hyflux is limited too. https://www.theedgesingapore.com/?q=hyflux-rescue-bid-smi-falls-through-amid-conflicting-statements |
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Stephenchow
Veteran |
06-Apr-2019 09:14
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Accounting regulator keeping close watch as investors ask why auditors failed to flag risksFor a decade, audit firm KPMG had stamped Hyflux' s annual reports with a clean bill of health, attesting to the water treatment company' s ability to continue to operate. But with the company now facing the possibility of liquidation after a scuppered restructuring deal on Thursday, its shareholders and investors are asking why auditors failed to flag the risk of Hyflux spiralling into heavy debt. This might well be a key question on the minds of Singapore' s accounting and auditing regulator, which told The Straits Times that it is monitoring the Hyflux quagmire closely. The Accounting and Corporate Regulatory Authority (Acra), which enforces Singapore' s strict auditing and accounting laws and standards, said in a statement that it will also " assess if further action is warranted" . The Acra spokesman did not elaborate further. Acra' s statement came a day before the restructuring agreement between Hyflux and SM Investments collapsed on Thursday, with both parties laying the blame on the other side for the demise of the $530 million deal. As a result, the scheme meetings that were supposed to be held yesterday were also cancelled, and the day passed without any pronouncements from either side. Acra now joins a trio of financial regulators - including the Monetary Authority of Singapore and the Singapore Exchange - which have publicly said they are keeping a close watch on affairs. Corporate governance experts believe the accounting and auditing issue is likely to centre on Hyflux' s 2017 books, which the company released in March last year and carry the unqualified opinion of the auditors. It had slipped into the red for the first time in 2017 since its listing in 2001. Yet two months later in May, Hyflux shocked investors when it filed for bankruptcy protection. Its financial statements were prepared on the basis of going concern - an accounting method that assumes the company will remain solvent and operational indefinitely until proven otherwise. According to Singapore' s auditing standards, auditors are duty-bound to question this assumption, assessing any risks to the company' s ability to stay afloat and avoid bankruptcy. They are also required to remain alert to any events or conditions that show otherwise. Hyflux, in response to queries from the Securities Investors Association (Singapore) in February, told the watchdog there were no events to cast significant doubt on the assumption of going concern. National University of Singapore associate professor of accounting Mak Yuen Teen said that if auditors had given an adverse opinion, ordinary shareholders and creditors could have chosen to get out earlier. He noted that there were no separate audited statements for the group' s loss-making subsidiary Tuaspring for 2017. Instead, Tuaspring' s 2016 audited figures were used by Hyflux in its latest replies to investors, with no mention on what happened to the 2017 statement. This was unusual considering the importance of Tuaspring to the group, said Prof Mak. The Tuaspring integrated water and power project is the largest asset on Hyflux' s balance sheets, and the group had stated its intention to partially divest the plant in 2016. The subsidiary had appointed KPMG as its auditor since 2011. Hyflux had also relied on external valuers to arrive at its $1.4 billion valuation of Tuaspring in 2011, 2013 and 2016, but this was later written down by more than $900 million last year. In Hyflux' s annual report for the 2016 financial year, auditors had been aware of an independent external consultant hired by Hyflux to perform a Singapore power market study on the power plant. The KPMG audit report that year stated that it had reviewed the methodology used and analysed the assumptions, which include details such as future electricity prices, plant utilisation and discount rates.Prof Mak said that while auditors do not carry out valuations directly, it is their duty to provide robust oversight and question the third parties too. " It is often the case here that auditors do not challenge assumptions enough," he added. Others pointed out that the $500 million perpetual securities - bonds with no maturity dates - issued by Hyflux are recorded as equity instead of debt in its books. Such a practice is allowed under current accounting rules, and could have the effect of improving the group' s debt-to-equity ratios and give an impression of recovery. One investor, who did not want to be named, asked if auditors had probed this aspect in determining Hyflux' s financial health, considering that the company had been generating negative cashflow for consecutive years. KPMG, which had audited Hyflux since 2008, declined comment, citing client confidentiality |
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Stephenchow
Veteran |
05-Apr-2019 20:47
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To save a company in $3b debt, you will need to be a billion dollars company at least. If you have billion dollars will you:- 1. Invest in an unicorn company like airbnb, uber and didi chuxing? once they listed, you make another few billions dollars? OR 2. Invest in a company that has $3b debt, office and plant buildings belong to reit, most plants going to be nationalised, liquate soon if not miracle, with a few thoudands worrisome staff waiting for severance package and long queue of angry bond/notes/perp/stock investors, bank creditors and lawyers waiting to serve you law suit plus potentially losing $39m in one go as White Cuckoo? What do you think? |
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investshare
Supreme |
05-Apr-2019 18:24
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The legal fee makes things worse. | ||
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Starship
Supreme |
05-Apr-2019 18:20
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Company, Exec, Stock, Story, Legacy, Future .........................everything look just as........... Ugly Hyflux says Salim-Medco rescue is off both sides play the blame game The two parties are also laying claim to the S$38.9m deposit that Salim-Medco put into escrow last year, when it agreed to be Hyflux' s white knight FRI, APR 05, 2019 - 5:50 AM HYFLUX said on Thursday that a key rescue deal from the Salim-Medco group is officially off, with just weeks to go before the water and power plant company loses court protection from creditors. Hyflux has cancelled scheme meetings scheduled for April 5 and 8. There is also no need for shareholders to attend an extraordinary general meeting scheduled for April 15, the company said. Now both sides are arguing over who killed the deal. The answer may determine who gets to pocket the S$38.9 million deposit that Salim-Medco (SMI) put into escrow last year, upon agreeing to play white knight for Hyflux. Reacting to Hyflux' s announcement on Thursday, SMI, led by Indonesian billionaire Anthoni Salim, said it was " surprised" by Hyflux' s " purported termination" of the rescue deal, and will be taking legal advice in relation to Hyflux' s action. In a late Thursday night filing, Hyflux said it wrote to the investor to request a clear and unequivocal written confirmation of its commitment, and stated clearly that the company would have no choice but to terminate the restructuring agreement if the investor declined to do so. " Regrettably, the investor, in a letter from its lawyers dated 4 April 2019, declined to provide the written confirmation sought," Hyflux added. Salim-Medco was supposed to invest S$530 million into Hyflux in exchange for a 60 per cent stake once Hyflux' s debts had been cleared, an investment that formed a key pillar in Hyflux' s restructuring plans. But SMI had a change of heart in recent weeks, citing concerns about Hyflux' s working capital requirements and the cash distribution plan under the proposed restructuring. On Thursday, Hyflux said it had tried to meaningfully engage with the Indonesian investor group on multiple occasions: " However, in light of the investor' s responses and conduct, the company has no confidence that the investor is prepared to continue to complete the proposed investment." It added: " They have also not refuted the statements in the media that SMI was ' slated to walk away' from the deal. Without the confirmation from SMI to dispel the overhanging uncertainty over this deal, it would not be possible for the stakeholders to have a proper vote." Effectively, Salim-Medco has repudiated the restructuring agreement and Hyflux has accepted its repudiation, the Singapore company said. " The restructuring agreement is therefore terminated," Hyflux stated. With Hyflux' s court-sanctioned reprieve from creditors set to expire on April 30, the company now finds itself with its back to the wall. Still, Hyflux sought to reassure stakeholders on Thursday, and promised to " pursue all other viable strategic opportunities" and restart talks with key creditors and stakeholders. Recent actions by national water agency PUB have also put it in a better position to find a new white knight, Hyflux said on Thursday. Last month, PUB said if Hyflux subsidiary Tuaspring Pte Ltd (TPL) fails to cure its defaults, resulting in a termination of the Water Purchase Agreement, PUB will acquire the loss-making Tuaspring desalination plant for zero dollars, and without seeking compensation from TPL. PUB had given TPL until April 30 to cure its defaults, but the termination of the Salim-Medco deal means TPL' s deadline will be brought forward to Friday, April 5. Since Hyflux cannot help TPL by Friday, PUB is expected to take over the plant in early May. Potential investors who would have preferred to invest in Hyflux but not the water plant may thus return to the table, Hyflux suggested. " (This) development could potentially enable the company to reach out to a wider pool of investors who may not otherwise have been interested in an investment in the group had this asset remained within the group, and for which PUB' s approval for a change in control of such asset will be required." As for the loss-making Tuaspring power plant on the same site, ownership will remain with Hyflux. Hyflux might appeal to the Singapore High Court for more time to find a white knight, but the Court will need to be convinced that extending Hyflux' s debt moratorium beyond April 30 can give creditors a better outcome than liquidation. The Hyflux board will " quickly re-engage with previous interested parties" who had bid for Hyflux alongside SMI last year, Hyflux chief executive Olivia Lum told David Gerald, who leads the Securities Investors Association (Singapore), or SIAS. Mr Gerald said: " She said the board needs some time to negotiate with interested parties and has asked that they be given some time and space to work on an alternative proposal to avoid liquidation. SIAS calls on senior creditors to give the company a chance to provide an alternative proposal and not put the company under liquidation hastily, in which case the retail investors who are the perps and preps holders will lose everything." Hyflux has more than 2,500 employees worldwide. Asked if they would be let go if no white knight emerges by April 30, Hyflux said it would now hold talks with its creditors, and is unable to say more than what has been announced it said it would give updates through its SGX announcements. And when asked whether PUB might recruit some Tuaspring employees to run and maintain the desalination plant, Hyflux said it is unable to speak on PUB' s behalf or comment on whether PUB' s recruiting plans. Hyflux' s position now is that SMI repudiated their restructuring agreement, so Hyflux is entitled to SMI' s S$38.9 million deposit. Salim-Medco sees it differently, so the matter may be bound for the courts. " SMI has at all times abided by the restructuring agreement," it said. " SMI has been waiting for Hyflux to disclose further material information following multiple requests for such disclosure. The delay in disclosing this material information has prevented SMI from determining a workable allocation between working capital and the settlement amount to creditors under the restructuring agreement." Salim-Medco reiterated that it had issued Hyflux notices to remedy threats to the Tuaspring and Magtaa projects on March 18 and 25 respectively. These refer to the now likely termination of Tuaspring' s water contract with PUB, and a notice from Magtaa' s offtakers to terminate its water contract last December, which SMI said it learned about only three months later. " These threats have not been remedied," Salim-Medco said, adding that it had learned of a threat to a third major project on Wednesday. But Hyflux, in a statement late on Thursday, dismissed the point about a " threat" to the third project, SingSpring Trust, in which it has a 30 per cent minority interest. It said that the majority interest holder, Keppel Infrastructure Fund Management (KIFM), had written to Hyflux on March 29 to say that the holding of the Scheme Meetings entitled it to exercise buy-out rights, that is, KIFM may choose to buy part or all of Hyflux' s interest in SingSpring for value, subject to regulatory approvals, and sought to reserve those rights. Specifically, KIFM had asked for confirmation that it would not be subject to the Schemes proposed, and that its buy-out rights would not be compromised or affected by these Schemes. Hyflux said: " It is important to note that KIFM' s letter does not indicate whether it intends to exercise such buy-out rights (which it is under no obligation to do so), and there can be no assurance that KIFM will ultimately choose to do so. Accordingly, there is no ' threat to a third major project' as asserted by the investor (SMI)." https://www.businesstimes.com.sg/companies-markets/hyflux-says-salim-medco-rescue-is-off-both-sides-play-the-blame-game-0 |
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enjoylife77
Veteran |
05-Apr-2019 17:24
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x 0 Alert Admin |
Every few years bound to have an episode whereby the retail investors suffered big time. 2013 is the Blumont. Asiason, Liongold episode. Then Olam, Noble. Midas, Yuuzoo, Swiber, Ezion, Ezra, Raffles, EMAS .......We just have to watch out for the next 14 names going forward and to sell in advance. | ||
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