White knight investor throws Singapore's Hyflux rescue into doubt
SINGAPORE, March 28(Reuters) - An Indonesian white knight, whose proposed investment in Hyflux is crucial for the beleaguered water treatment company's rescue, said on Thursday that conditions for a deal to restructure the firm had not been met.
In October, SM Investments (SMI), a consortium of Indonesia's Salim Group and Medco Group, had agreed to acquire 60 percent of Hyflux for S$400 million ($290 million) and also give it a loan of S$130 million. Hyflux, which is currently under a court-supervised restructuring process, was to receive S$30 million as interim working capital until the deal was completed.
"SMI recently became aware of new material information on the Hyflux group that significantly increases the working capital requirements of the group," it said in an emailed statement, adding that would affect the amount available for settlement to creditors.
SMI said it did not agree with Hyflux's proposed allocation of the payment to creditors.
This marks the latest exchange in a dispute between Hyflux and its white knight, which has also warned Hyflux that it could walk away from the deal if the company does not fix defaults that could allow its prized Tuaspring desalination and power plant to be taken over by Singapore's public water agency.
Water agency PUB has said it might take control of the desalination plant as Hyflux had been unable to fulfil its contractual obligations. PUB said although the current valuation for the plant is negative, it would buy it for zero dollars.
Hyflux is set to hold scheme meetings on April 5 for creditors, including bondholders, to vote on its debt restructuring terms. (Reporting by Aradhana Aravindan; Editing by Shreejay Sinha)