Hyflux

[wonghw12]

https://www.channelnewsasia.com/news/bus...x-10407930

I too was once nearly fooled by a belief that Hyflux will redeem its perps and that the downside will be holding to a paper with 8% interest. Didn't expect there was a worse scenario where Hyflux decides not to pay at all.

While Hyflux perps value wont be zero, my sensing is that Hyflux's mgmt are probably going to do an "ezion" by offering perp holders either i) an equity swap at a certain price or (ii) a terrible bond deal offering interest rates close to zero. In the end, Perp holders will be forced to take option (i) and lose majority of their principal

I think it is difficult to say if the Hyflux perps have more than a near zero value... The cash burn is rapidly depleting the capital base. In a liquidation scenario, it is foreseeable that a huge writedown on assets may happen. Note that Hyflux has announced that it has received letters of demand, letters notifying of defaults, notices of acceleration. There is no guarantee that lenders will want to cooperate in a way that preserves and leaves much value for the prefs and perp holders. Not sure how true this is, my broker told me that there are senior bondholders want to get out at 40cts to the dollar. If senior bondholders have to take a significant writedown, the outcome may be more unfavourable for the prefs and perp holders.

Early this year, I have flagged the risk that not paying coupon and not redeeming the pref and perps are real possibilities. Unless it is an impossible event, never say never...

[sgdividends]

1 Supreme Court Lane, Singapore 178879
19 June 10am
Court hearing
You need to email hyflux lawyers to let them know. See hyflux website for details .

Join the retail investors group for updates on hyflux if u own perpetual securities , preference shares or hyflux stock
https://t.me/hyflux_retail

Sorry admin, some form of advertising but no money earned for me if people join the telegram group. Just helping to gather the affected people and update one another .

Pls delete if inappropriate. Thanks

[weijian]

hi sgdividends,
No issue on this. Previously we have also let our activist made similar calls in threads like Sabana REIT and most recently Asiatic Group.

Moderator

[sgdividends]

Thank you Weijian!

[CY09]

https://www.businesstimes.com.sg/compani...00m-rescue

Hyflux has revealed that it has only 18.6 million of cash left. This means another cash burn of 215 million has occurred as it has decreased from its stated $233 million in cash announced as of end 31 Mat 18.

The company also reveals it needs more cash for working capital and said creditors will face a huge haircut under liquidation. In my opinion, it seems another episode of Ezion is going to occur. Massive dilution is going to occur. What makes Hyflux worse than Ezion is that it has 3.0 billion of debts (including presence shares to handle) as against Ezion's 1.6 billion.

I am very interested to see how much will the debt to equity conversion rate be and how much sell down will there be. Ezion has showed that prices can fall to only 30% of the conversion rate (aka a loss of 60%-70% in face value)

[sgdividends]

Hi,

I don't think debt to equity is in the works but rather a cut in coupon and a further redemption for the noteholders with a waiver in previous defaults.

Some of us were at the court hearings and shared in the telegram group.

Join the retail investors group for updates on hyflux if u own perpetual securities , preference shares or hyflux stock

https://t.me/hyflux_retail

[Behappyalways]

What will Hyflux do during its 6-month lawsuit protection?
https://sbr.com.sg/utilities/in-focus/wh...protection

[weijian]

Hyflux Lum is framing this as a liquidity issue. But some VBs are calling the bluff and believe that the assets on the BS have to be written down, and when it is written down, it obviously becomes a solvency issue instead.

[Behappyalways]

The company needs to reduce debts and increase equity. Who is the best to approach? The one who has already got his feet wet. So the bond holders and preference share holders will probably be 'persuaded' to take some hair cut, convert debts to shares and reduce bond interest for the remaining. Then it would be easier to persuade new investors (whose legs are still dry) to come in......

[sgdividends]

Hyflux Lum is framing this as a liquidity issue. But some VBs are calling the bluff and believe that the assets on the BS have to be written down, and when it is written down, it obviously becomes a solvency issue instead.

Weijian, how did the VBs find out its a bluff ?

We won't know as numbers are held confidential as a P3 state by the judge.

Join the retail investors group for updates on hyflux if u own perpetual securities , preference shares or hyflux stock

https://t.me/hyflux_retail