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Hyflux receives letter about possible investment by North American fund manager
ANOTHER potential suitor has emerged for distressed water treatment firm Hyflux.
This time, it is an unnamed North America-based fund manager that has a “strong” track record of investing in infrastructure, technology and real estate globally, according to a letter from transaction advisory and strategy consulting firm The Spectrum Solutions Group.
Hyflux on Sunday night disclosed that it received the letter from New York-based Spectrum - on behalf of the fund manager, its client - expressing desire to engage with the Singapore firm to explore the possibility of investing in Hyflux.
Spectrum and the fund said they are looking to structure a deal to address the interests “of all major shareholders”, including the holders of the perpetual securities and preference shares as well as the unsecured working group of banks.
Having closely followed Hyflux’s restructuring process, Spectrum has determined that the water treatment firm is a good investment candidate for the fund.
This is “due to Hyflux’s ability to provide strategic geographical exposure, brand value potential, and the expertise of (its chief executive Olivia Lum) and the management team”, according to the letter.
The fund has received “definite interest” from several of its institutional investors, including two Canadian pension funds with extensive experience on similar large-scale infrastructure projects and a Swiss investment group with long-term investments in sustainability projects, Spectrum added.
The fund has deployed more than US$1.3 billion in equity to date, and emphasises on value creation through operational optimisation and close collaboration with management.
According to the letter, Spectrum is experienced with cross-border transactions, restructuring as well as corporate strategy development. Its transaction advisory group serves North American institutional investors and Chinese outbound investment funds.
Hyflux on Sunday said it is considering the contents of the letter and will announce as and when there are any further material developments.
The firm’s potential white knights include Middle Eastern utility firm Utico, Pison Investments and Singapore-incorporated Aqua Munda.
Utico last week submitted a firm and legally binding term sheet for Hyflux with the same terms and conditions as those in last November’s restructuring agreement, which had lapsed.
Pison is the investment vehicle of Indonesian magnate and chief executive of PT Havilah, Johnny Widjaja. In early July, Pison made a formal cash offer for the debts of Hyflux’s bank lenders, noteholders and other senior unsecured creditors.
Singapore-incorporated Unilegend Investments, on behalf of an unnamed client that focuses on clean energy and water, this month also wrote in to Hyflux to express its interest in a possible investment.