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SIAS calls on Aqua Munda to disclose funding, intentions regarding Hyflux
THE Securities Investors Association (Singapore) (SIAS) has requested Aqua Munda, which is looking to buy over some of Hyflux's debt, to disclose more details on its source of funding and intentions.
Aqua Munda, a Singapore-registered company, has invited Hyflux’s medium-term noteholders and senior unsecured creditors to tender their debts for purchase at a minimum 85 per cent discount. The invitation, which kicked off on Monday, expires at 5pm on Jan 23, 2020.
In a press statement on Monday, SIAS president David Gerald said that creditors have raised queries on the “identity of Aqua Munda and its director and sole shareholder, and whether Aqua Munda has the necessary funds to complete their proposed reverse Dutch auction”.
“SIAS calls on Aqua Munda, in the interest of transparency, to disclose its funding and the entities related to Aqua Munda and its intention with respect to restructuring process as soon as possible,” Mr Gerald said in the statement.
The Business Times reported on Dec 19 that Aqua Munda is owned by Singaporean businessman Bambang Sugeng Kajairi, who is understood to represent an investor group from the Middle East. The identity of the group has not been disclosed.
SIAS has been advised that Hyflux is not obliged to conduct any due diligence on Aqua Munda, he added. This is because the invitation is solely between Aqua Munda and the relevant creditors, while Hyflux is only facilitating the dissemination of details, he added.
Therefore, noteholders must ensure that they have read and understood the terms of the invitation before making an offer to Aqua Munda for the debt, as they cannot withdraw after the offer is tendered, Mr Gerald cautioned. He added that Aqua Munda may withdraw the invitation if the required level of support is not attained.
Aqua Munda’s present invitation is not open to Hyflux’s perpetual securities and preference (PnP) holders. Some PnP holders have told SIAS that they would like a similar exercise, Mr Gerald acknowledged.
On that matter, he said: “Aqua Munda has announced that they would engage SIAS after the close of the current invitation. Aqua Munda has indicated their commitment to a debt restructuring exercise that is fair and equitable for all stakeholders. SIAS will update all PnPs on any discussion or proposal received from Aqua Munda.”
Earlier on Monday, Hyflux announced that it is expecting the termination of a previous settlement agreement with Mitsubishi Heavy Industries to cause an "overall material adverse financial impact to its financial performance".