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Hyflux says it could get S$400m from UAE utility group Utico

WATER treatment company Hyflux could get an emergency injection of S$400 million from Emirati utilities group Utico FZC, it said in a bourse announcement late on Friday night.

Mainboard-listed Hyflux has named Utico as its mystery white knight candidate, a week after floating a non-binding letter of intent in a bid to stay its creditors.

Utico plans to invest to keep the debt-hit Hyflux's key entities "intact and operational", with the funds to go towards equity and working capital purposes "and possible urgent interim funding", said Hyflux.

It added that Utico "is aware of the urgency of the restructuring" for Hyflux's debt.

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The United Arab Emirates-based Utico – which counts sovereign investors from Oman, Saudi Arabia, Bahrain and Brunei among its backers – plans to keep Hyflux's management team and strike "an amicable deal" with creditors and investors "on a win-win basis", Hyflux added.

Hyflux, which faces billions in claims from a slew of retail investors, banks and other creditors, recently had its debt moratorium extended to May 24.

The company seemed for a spell to have been left high and dry when it parted ways with Indonesian consortium Salim-Medco Investments in April, after national water agency PUB moved to take over Tuaspring desalination plant, a critical Hyflux asset.

But the group last week touted a letter of intent from an unspecified Middle Eastern firm – now revealed to be Utico – as it asked the courts for more time on its debt freeze.

Chief executive Olivia Lum also said then that a sovereign fund from the Persian Gulf, a sovereign fund based in North Africa, and an Australian investment fund are some other parties engaged in early talks.

Hyflux, in its latest update, has now said that its legal and financial advisers are "in active discussions" with Utico to hammer out a binding term sheet for the potential rescue deal. It is also in talks with "several other parties" that are interested in investing, it confirmed in its latest statement.