[ad_1]
Malaysian Banking, or Maybank, Singapore branch
Hyflux said the creditor Maybank was immediately ending its collaboration agreement with Singapore's leading water infrastructure player, due to its inability to reach a binding deal with a bidder or investor.
This constitutes a violation that can not be repaired under the collaboration agreement, "said the letter, according to the Hyflux record. In addition, Maybank sent notifications to the water regulator in Singapore, PUB, and to the Singapore Energy Market Authority, Hyflux said.
"These notices relate to an execution event and an acceleration of the maturity of all amounts due under Tuaspring's financing documents," said Hyflux in the filing. "Maybank also announced plans to appoint receivers and managers on Tuaspring's badets, with the exception of the desalination plant and the shared infrastructure." Maybank Loans to Hyflux were substantial: a research note published in August by CGS-CIMB indicated that the exposure was $ 658.6 billion. million at the end of the first half of last year.
Multiple delay extensions
The Malaysian bank had agreed to suspend the lawsuit against Hyflux on the condition that the Singaporean company enter into an agreement with a contractor or investor who would pay Maybank in full. An agreement had been reached and Maybank had provided Hyflux with multiple extensions of their contract term.
SM Investments, a consortium of the Salim Group and the Medco Group, signed a binding agreement in October to invest S $ 530 million for a 60% stake in Hyflux, which had filed for judicial protection in May. Hyflux said the overproduction of gas in the Singapore market had led to lower electricity prices, which affected earnings in 2017 and led to losses in the first quarter of 2018.
No trust
However, in early April, Hyflux terminated the deal, saying it did not trust SM Investments to complete the investment after the Indonesian consortium failed to make a written commitment to do so.
The termination of the agreement led Singapore's water regulator, PUB, to cancel the extension of the default cure period for the contractual obligations of the Hyflux Tuaspring desalination plant. Last Wednesday, PUB warned Hyflux that it would terminate its water purchase contract and take control of the plant.
Another headache
Maybank's decision might pose another problem for Hyflux: "The termination of the collaboration agreement should have a significant impact on the group's financial performance," said Hyflux.
This article was previously published in Shenton Wire.
Source link
