SIAS refutes Utico's claims in Hyflux's town hall meeting

The UAE-based firm said that the association has not worked towards a better deal for P&P holders.

The Securities Investors Association Singapore (SIAS) has called on Utico and Hyflux to clarify the contradictory stances made during its recent town hall meeting regarding the embattled firm’s restructuring scheme, according to a press statement.

The association denied allegations by Utico that it has not worked towards achieving a better deal for the P&P holders, saying that it has, directly to Utico and Utico’s advisors and through Hyflux’s advisors, consistently advocated for improved terms for the P&P holders in meetings, correspondence and conference calls.

“SIAS is disappointed that Utico has chosen to make such an allegation when it well knows that SIAS has, directly to Utico and Utico’s advisors and through Hyflux’s advisors, consistently advocated for improved terms for the P&P holders in meetings, correspondence and conference calls,” said David Gerald, the founder, president & CEO of SIAS.

Gerald has even listed the steps they and their advisors took on the Utico deal.

Furthermore, Utico was urged to explain why it claimed that there had been no changes in the deal with the preference shares and perpetual securities (P&P) holders, noting that the additional cash amount for Option 2 was revised to be reduced based on the percentage of holders who chose Option 1. Initially, the amount was set at a minimum of $50m.

Also read: Utico to hike advisors fees cap to $50m if Hyflux rescue deal bags approval

“SIAS has been seeking an explanation from Utico on this since the change was first made known to them in November 2019 and has, notwithstanding raising this issue in a press statement dated 20 November 2019 and in an email dated 13 January 2020 to Hyflux, not yet received a satisfactory answer,” the association said.

Utico was also asked to confirm if it now agrees to provide a “soft landing” payment, how much Utico is prepared to pay the P&P holders on this and the time period on this.

The current terms provided that holders who picked Option 2 will receive a share of 4% in cash value of Utico if the investor lists on a stock exchange within 2 years after the restructuring. With the soft landing payment, Utico will still pay the holders a certain amount if the listing occurs after the 2-year period.

The association also invited Utico to provide them with a copy of all the financial information which has been provided to the advisors to the senior unsecured creditors, as the investor has only provided snippets of information at most, which they found inadequate.

Utico was also asked to confirm on whether Hyflux’s directors will be giving up their entitlement on the proposed scheme, which SIAS was for.

Furthermore, clarifications were also asked if P&P holders would receive up to $1,500 per account, if 1.5% interest will be paid on the deferred amounts, and whether the 4% cash equivalent is on the table.