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Stocks to watch: Hyflux, ESR-Reit, Raffles Education, Transcorp Holdings
THE following companies saw new developments that may affect trading of their shares on Wednesday:
Hyflux: Hyflux subsidiary Tuaspring Pte Ltd has been slapped with a default notice from Singapore's water agency for failing to keep its desalination plant "reliably operational" as required under the Water Purchase Agreement. Tuaspring has a cure period of 30 days until April 5 or "such longer period as may be reasonable", to consult with PUB on the steps it must take to cure the alleged defaults. If the defaults are not cured in time, PUB has the right to terminate the water contract by giving written notice of not less than 30 days to Tuaspring. PUB can also take control of the plant, once the default notice period expires.
ESR-Reit: ESR-Reit has secured a S$155 million unsecured loan facility to refinance existing indebtedness, acquire assets and improve currently owned assets as well as other general working capital purposes, its manager announced on Tuesday night. It will comprise two tranches: a S$75 million term loan facility maturing 36 months from March 4, 2019, and a S$80 million term loan facility maturing in 48 months. The lenders are the Singapore branches of Australia and New Zealand Banking Group (ANZ), CTBC Bank and Standard Chartered Bank. Separately, the industrial Reit also announced that its trustee had filed proofs of claim on March 1 against beleaguered water treatment firm Hyflux and its subsidiary Hyflux Membrane Manufacturing (S), which leases the Reit's property at 8 Tuas South Lane. ESR-Reit units closed unchanged at S$0.540 on Tuesday before the announcements.
Raffles Education: Raffles Education on Tuesday said it will not proceed with its rights issue in light of "recent market conditions", and its prevailing share price being below the issue price of the proposed rights shares. Shares in Raffles Education closed at 8.8 Singapore cents apiece on Tuesday, down 2.2 per cent or 0.2 Singapore cent. The company had planned to raise 275.86 million new shares at an issue price of 10 Singapore cents, on the basis of two rights shares for every 10 existing shares. On Dec 6 last year, the private education operator announced a renounceable, non-underwritten rights issue. This would raise S$27.44 million in net proceeds, meant primarily to repay loans owed to chairman and chief executive Chew Hua Seng.
Transcorp Holdings: Transcorp has issued a notice of demand on March 4 to recover S$2.6 million in advance deposits from a supplier after an attempt to seek a full refund failed. Its subsidiary, Regal Motors, had inked a two-year agreement with the supplier on Jan 1, 2016 to supply motor vehicles. The agreement was then extended for a further two years on Jan 1, 2018. As part of the agreement's terms, Regal Motors made advance deposits to the supplier. As at Oct 31, 2018, the supplier still owed about S$2.8 million to Regal Motors, of which S$147,000 was subsequently paid. Transcorp shares closed flat at 0.4 Singapore cent apiece on Feb 28.