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Hyflux applies for super priority for rescue financing

HYFLUX announced after trading hours on Friday that the company has applied to the Singapore High Court for super priority for rescue financing on Nov 1.

This is with regard to the proposed investment in Hyflux by SM Investments, a consortium between Salim Group and Medco Group.

Hyflux is seeking more time to put its restructuring plan to a creditors' vote by April.

SM Investments has agreed to give Hyflux a S$400 million equity injection in exchange for a 60 per cent stake in the company once it has settled all its debts.

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SM Investments will also grant Hyflux a shareholder's loan of S$130 million and a debtor-in-possession loan of S$30 million to help finance it through the restructuring. The deal is subject to the approval of creditors, as well as national water agency PUB and other authorities. The deal will include debt-for-equity swaps since Hyflux does not have enough cash to clear all its debts.

SM Investments has also agreed to issue shares to certain key members of the Hyflux management team to ensure management continuity.

The company said that it will provide further details on this application when the Court has given its directions.