Singapore high-flyer eyes ‘protection’ for debt talks

Bloomberg

Hyflux Ltd., the Singapore water treatment firm, is considering seeking a form of court protection to facilitate negotiations with creditors, people with knowledge of the matter said.
The company is considering asking the Singapore courts for a 30-day moratorium preventing creditors from taking certain actions that could hurt its financial position, according to one of the people. The move would give Hyflux space to work out an arrangement with the creditors,
the person said, asking not to be identified because the information is private. It was expected to file an application as soon as Tuesday, May 22, the person said.
Hyflux has been working with an adviser to explore options for managing its debt load, the people said. The turnabout in fortunes for the company, whose founder Olivia Lum was a poster child for local entrepreneurs, adds to signs of pressures that smaller borrowers in the Singapore debt
market face.
“A debt workout of some sort was inevitable,” Ezien Hoo, a Singapore-based credit analyst at Oversea-Chinese Banking Corp., said. “They were facing short-term debt, as well as the need to maintain cash to meet their bond covenants.”
Hyflux last year posted its first annual loss since listing, and the company has said its energy business could suffer as an oversupply of gas depresses electricity prices. It’s been in talks to sell a stake in its single largest asset, the Tuaspring project, which combines Southeast Asia’s largest desalination plant with a gas turbine power plant.