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SIAS and its advisers to remain independent, let Hyflux PnP holders 'decide for themselves'

THE Securities Investors Association (Singapore), or SIAS, and its advisers will not be swayed by statements made to incentivise them to promote Utico’s rescue package for Hyflux.

The investor advocacy group’s advisers – Drew & Napier and PricewaterhouseCoopers Advisory Services – will “act entirely independently in assisting SIAS to engage with the PnP (preference shares and perpetual securities) holders, who will decide for themselves whether or not to accept the Utico deal”, said David Gerald, president & CEO of SIAS, in a press statement on Friday, in response to a letter from Utico.

In its letter dated Jan 28, the Emirati utility firm said it will shrink the pot of money for adviser fees to S$30 million from the current S$40 million if advisers fail to support the scheme.

On the other hand, Utico promised to increase the pot to S$50 million if all advisers support the scheme and the restructuring agreement between Utico and Hyflux.

The letter added that SIAS’s advisers “will be treated in a special manner” if their efforts result in votes from the Hyflux PnP (perpetual securities and preference shares) holders at the scheme meeting in March.

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On Friday, Mr Gerald said SIAS’s advisers have “always unequivocally stated to SIAS” that they will not accept higher fees in exchange for encouraging the PnP holders to accept the Utico deal.

This is regardless of whether they are current on their fees or are assured of their fees.

“There is therefore no issue of any assurance of their fees being paid,” he added.

Last month, sources told The Business Times that there was an issue concerning assurances given on the ring-fencing of adviser fees for SIAS. The sources said there was disagreement as to whether such fees had indeed been safeguarded to ensure that SIAS’s advisers are paid.

On Thursday, Hyflux’s new lawyers from Clifford Chance said that adviser fees are one of the four outstanding matters that need to be settled with the unsecured working group of creditors to gain their support.

Clifford Chance has until March 10 to apply for leave from the High Court to convene Hyflux’s scheme meeting for Utico’s rescue package.

The judge on Thursday also extended the water treatment firm’s debt moratorium to April 30.

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