Hyflux in talks with Utico, exploring options, including Aqua Munda

BELEAGUERED water-treatment firm Hyflux said that it continues to be in discussions with Utico, following the potential white knight's decision to revoke the cash component of its rescue deal. 

In a bourse filing on Friday, Hyflux said that it is "considering the contents" of Utico's May 26 letter, in which the Middle Eastern utility provider said that all cash considerations it had earlier offered will be substituted for stock in Utico and Hyflux. 

This means that holders of Hyflux's Perpetual securities and Preference shares (PnPs) will receive shares comprising 5 per cent of Utico and 12.5 per cent of Hyflux as payment, but with no cash component. Meanwhile, senior unsecured creditors will have to accept 17 per cent of Utico and 12.5 per cent of Hyflux as payment.

The new offer is valid only until June 4.

Hyflux said it is concurrently pursuing other options, including those with regard to other potential white knights, namely Aqua Munda, Longview and FCC Aqualia. 

However, the circumstances surrounding Aqua Munda have attracted controversy, as it has not made any offer to PnP holders. But if Aqua Munda buys out all of the senior debt, Hyflux can exit the restructuring process.

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As The Business Times previously reported, Aqua Munda is widely speculated to be a stalking horse for someone. This perception has been fanned by how Hyflux has not addressed questions about whether its board and advisers have an interest in Aqua Munda.

Hyflux's next case-management conference is at 10am on June 11.