SM Investments (SMI), the Singapore unit of Hyflux’s debt consortium Salim-Medco and the water treatment firm’s former white knight, has announced its intention to sue the company for terminating their bailout agreement.
The Straits Times reported SMI as saying on Fri (19 Apr) that it did not accept Hyflux’s “purported termination” of the rescue deal on 4 Apr.
Instead, it highlighted that it had only ceased the agreement with Hyflux today (19 Apr) in line with their agreement.
The agreement was terminated due to several “termination events”, according to SMI.
“This was a repudiatory breach of the agreement by Hyflux entitling SMI to terminate the restructuring agreement,” said SMI.
SMI also cited Hyflux’s failure to meet certain conditions by the 16 Apr deadline as a basis for declaring the termination of their agreement, ST reported.
For instance, Hyflux was set to convene scheme meetings for stakeholders, during which they will be able to vote on a sanctioned scheme of arrangements regarding the repayment of the firm’s creditors, but this was blocked by Hyflux’s decision to cancel the meetings.
“Each of the termination events entitles SMI to a refund of its deposit in accordance with the restructuring agreement,” said SMI.
SMI’s termination of the rescue agreement succeeds Hyflux’s commencement of civil proceedings against Salim-Medco over a “repudiation of the restructuring agreement” inked last Oct, which was denied today by SMI.