From making waves to drowning in red ink: Hyflux, Tuaspring and how a business giant came undone

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As Hyflux’s dramatic debt restructuring continues to unfold, its flagship Tuaspring desalination plant was taken over on Saturday (May 18) by PUB ...

Four months before, PUB had called a tender for Singapore's second and largest desalination plant to be built at Tuas.

It was also markedly lower than the first-year price of water for SingSpring Desalination Plant at S$0.78 per cubic metre.Five months after it submitted the bid, Hyflux was named preferred bidder for Tuaspring. It would be the company’s largest contract to date. True enough, Lum said in a Feb 15 affidavit this year that the “technical and financial viability” of the Tuaspring project was “validated and approved by various parties, including regulators, professional advisors and project finance lenders” at that point in time.

“They have to go through the Monetary Authority of Singapore to do these issues. You don’t see the smaller companies issuing these for retail investors so it seemed that only the safe companies are allowed." Net profit had dropped to nearly half of that in 2010. Operating cash flow, which indicates how much cash is generated from business activities, had been negative since 2010.

It remained aggressive in borrowing and issued 6 per cent perpetual securities in May 2016. Again, it saw red-hot demand from retail investors and had to upsize the issue from S$300 million to S$500 million. Max, the retail investor with preference shares, was among those that subscribed. “Clearly, the financials are unsustainable,” Ang thought. So he released a report on Sep 6, noting Hyflux as a “negative issuer” with a “highly leveraged” overall financial risk profile.

Hyflux’s debt to earnings before interest depreciation and amortization was at 13.4 times in 2016, while its debt-to-market capitalisation ratio stood at 3.9 times, his report said.

 

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Great article SeeKitCNA hyflux Did you ever get a satisfactory answer to the perplexing question in your tweet? PUB’s “$0 VALUATION” for the Tuaspring Plant alongside “PUB will WAIVE the compensation sum”. Students of Maths in Singapore and the World are confused!

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Oyster Bay Fund 'mulling investment in Hyflux'ANOTHER potential investor has deepened talks with Hyflux as the insolvent water-treatment firm searches for fresh funds to stave off liquidation. Read more at The Business Times. MarissaLeeBT is this the Oyster Bay Fund that Hyflux is referring to? OR OR THIS
Herkunft: BusinessTimes - 🏆 15. / 51 Weiterlesen »