SINGAPORE: With a crucial rescue plan aborted just weeks before its court-approved debt moratorium expires, Hyflux will have until Apr 25 to indicate if it needs more time to keep creditors at bay.
However, the beleaguered water treatment firm will need to put together “something fairly tangible” by then to convince the court that it deserves an extended lifeline, said Justice Aedit Abdullah on Thursday (Apr 11) during a case management conference.
Noting the concerns of some retail investors, Justice Aedit brought up an email he had received from perpetual securities and preference shareholder Violet Seow.
“She has expressed that she has no confidence in the restructuring attempt and says that the company should basically not be allowed to extend the moratorium for too long," he said.
While Hyflux has not decided whether to seek an extension in its debt moratorium, WongPartnership lawyer Manoj Sandrasegara told the court that “all options are on the table” and the company will be having discussions with all senior unsecured groups.
Justice Aedit also asked about the likelihood of a new rescue deal.
Mr Sandrasegara, who represents Hyflux, replied that it was “too premature” for him to comment.
Hyflux’s next case management conference is scheduled for Apr 25 at 2.30pm.
Knee deep in debt, the firm sought court protection to reorganise its debts last May. The lifeline granted to Hyflux is set to expire at the end of this month, after being extended by four and a half months from its original deadline of Dec 18.
Under its initial restructuring timetable, Hyflux was to have put its rescue plan up for voting by creditors last week. These were, however, cancelled after the company killed a key investment deal with would-be white knight SM Investments following weeks of disputes.
As the clock ticks down to the end of the debt reprieve without a new plan in sight, market observers said the U-turn in Hyflux’s debt restructuring journey has raised the odds of liquidation – a scenario that will see tens of thousands of retail investors losing almost of their investments.
Hyflux, in its announcement last week, sought to reassure stakeholders by saying that it will “continue to relentlessly pursue all other viable strategic opportunities”.