PUB says Salim-Medco should not use it as excuse to pull plug on Hyflux deal

HYFLUX's reluctant white knight Salim-Medco consortium should not use PUB as an excuse to back out of its investment agreement with the water treatment company, the national water agency said on Thursday.

PUB said in a statement: "Hyflux itself has noted that PUB's actions, in the event PUB elects to terminate the WPA, would be favourable to Tuaspring Pte Ltd, as this alleviates the pressure on the rest of the Hyflux Group, and also positively impacts Hyflux's value and hence the value of the Hyflux shares being offered."This will also increase the chances of Hyflux being successfully restructured.

While it can be argued that it's easier to turn around the power plant if market conditions improve, the desalination plant will continue to run at a loss unless the concession company is able to bargain with PUB for higher water tariffs.

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Tuaspring default threatens Hyflux restructuring dealHYFLUX'S restructuring agreement with SM Investments Pte Ltd may be terminated if defaults by Hyflux subsidiary Tuaspring Pte Ltd (TPL) are not remedied within two weeks, the water treatment company said in a Singapore Exchange filing on Monday. Read more at The Business Times.
Source: BusinessTimes - 🏆 15. / 51 Read more »