Hyflux 6% Perpetual Securities

[Toni90]

For now i am inclined to vote no. Will see how things develop. Anyway 3% cash 7% equity really nothing much to calculate.

Something is wrong if i vote yes and let mgmt continue drawing fat salaries. 3k i can forgo, i lost 3k but i uphold my ethics and dignity lol

If they give u 30k then u don’t care about your ethics and dignity?

 

[chopra]

i must have failed my business module. hw come equity still got value when perps has devalued so much. i tot bond safer than equity

 

[Mancunian2]

Criminal charges only for illegal things. For Hyflux, it's just incompetence. And no punishment got that.

there is such a thing call criminal negligence,
not sure if hyflux's management was guilty but it can't be far even if they are not

 

[arctician]

Recall in may2018, it went from CD to XD and after XD, hyflux withheld paying 3% for perps. In a way, the current 3% cash offer is iou, and hyflux is actually offering 0 cash in this scheme of arrangement.

correct. But i am glad they did not redeem the unsecured MTN due in 2018, otherwise perps will really have nothing left, not even crumbs

If they give u 30k then u don’t care about your ethics and dignity?

for me maximizing recovery is first priority, so dignity takes a backseat. If no choice but to write down then ethics take driver seat. But for sure i will vote no if i can only recover 3k cash, i rather donate it away

 

[surfman]

i must have failed my business module. hw come equity still got value when perps has devalued so much. i tot bond safer than equity

The senior unsecured creditor also can ask this question, how come perps got value when they have to take haircut, I thought pay finish senior debt then can pay subordinated debt...

 

[arctician]

The senior unsecured creditor also can ask this question, how come perps got value when they have to take haircut, I thought pay finish senior debt then can pay subordinated debt...

then maybank also can raise same question, why they need haircut when they have TS as collateral, they are supposed to be first in line. Thats why getting approval of scheme wont be easy

 

[Mr.Canberra]

Stocks and bonds can go to zero but not Forex. Unless the currency is from Zimbabwe or Japan WWII banana note.

 

[peterchan75]

Stocks and bonds can go to zero but not Forex. Unless the currency is from Zimbabwe or Japan WWII banana note.

But Forex is leverage beast. Event such as Swiss unpegged EUROS can be crazy shiat too.

 

[sanzhu]

there is such a thing call criminal negligence,
not sure if hyflux's management was guilty but it can't be far even if they are not

Ask keppel board of compliance

Kol lol

 

[Soul77]

I think morale of the story is always have cut loss strategy. No matter what it is, including govt bonds..

 

[Nainai]

then maybank also can raise same question, why they need haircut when they have TS as collateral, they are supposed to be first in line. Thats why getting approval of scheme wont be easy

You think Mayband need to take haircut?

 

[arctician]

You think Mayband need to take haircut?

no need. They already said post salim restructuring all the debt will be taken off the books with exception of few secured loans, so i assume they will resume staggered repayment to Maybank. I am guessing hyflux has to file for protection because they defaulted on monthly repayment to maybank.

I see maybank, salim and current management as key beneficiaries from the whole saga, MTN, perps and shareholders are almost wiped out.

 

[NicolasTeo]

‘Don’t vote in anger,’ says SIAS as distressed Hyflux retail investors start petition
Updated: 26 Feb 2019 08:00AM

Source: CNA/sk(mn)

Interesting that SIAS says don't vote out of anger. I would have said don't vote out of fear. Probably both are right.

Assuming the Salim deal is not voted for, what is Maybank going to do? Try to seize the Tuas plant and liquidate Hyflux? If yes, then it is already published elsewhere that the Offtaker can step in to seize the Tuas plant, and will Maybank then be at their mercy how much to receive?

Even if Maybank or the Offtaker seize the Tuas plant what will they do? Incur $80m loss every year in place of Hyflux shareholders? Do they really want that?

Not to mention that upon liquidation all the matters discussed by SIAS regarding whether whether past dividends were rightly paid, may surface in court. Absent liquidation, all that is merely speculative theory because in hindsight, it was rightly decided that the company does not become insolvent as a result of those dividends.

And in liquidation, will Tuaspring set the tone for the 4th and 5th desalination plant bidding process? Will the hurdle investment rate for future plants become higher thanks to a precedent failure? Will Tuaspring be the catalyst for a neighbor seeking higher returns on raw water sales?

If the Salim deal is not voted for, it seems to me the only rational recourse for everyone, whether Offtaker, Maybank or other creditor, is to try and reach another more favorable deal, not liquidate.

Still, there is no guarantee that anyone will do anything rationally, so some risk involved in voting "out of anger".

But it seems to me the more irrational approach in this case, is to vote "out of fear".

 

[V_for_Vanilla]

SIAS is a joke and not on the side of the retail investors although it portrays itself as such. SIAS and PWC has been going around telling retail investors getting "something is better than nothing". In other words to accept the proposal. It is insulting to suggest if retail investors vote otherwise they are doing so out of anger and not rational.

 

[arctician]

unfortunately perpholders are mostly retirees who are non financial saavy, i can see the risk reward ratio for maximum recovery is better if i veto it. Even if hyflux really liquidates, an investor with $100k will only lose 3% cash, but hyflux mgmt, secured and MTN risks are much higher. So any perp or pref share holders going to accept?

 

[Mancunian2]

unfortunately perpholders are mostly retirees who are non financial saavy, i can see the risk reward ratio for maximum recovery is better if i veto it. Even if hyflux really liquidates, an investor with $100k will only lose 3% cash, but hyflux mgmt, secured and MTN risks are much higher. So any perp or pref share holders going to accept?

agree, 3% is derisory

this Salim offer is no white knight, more like a corporate raider preying on distressed companies

 

[plexxor]

I rather give up the few % so that hyflux can liquidate and the accounts will be scrutinized.

Sent from The Matrix using GAGT

 

[cryingbaby1]

Hi, what is the projected amount in return if TS is to liquidate from the infrastructure? Can this amount be exceeded as compared to the amount that Salim is offering?

Thanks.

 

[Toni90]

Hi, what is the projected amount in return if TS is to liquidate from the infrastructure? Can this amount be exceeded as compared to the amount that Salim is offering?

Thanks.

Zero cash + some debt.

 

[arctician]

Hi, what is the projected amount in return if TS is to liquidate from the infrastructure? Can this amount be exceeded as compared to the amount that Salim is offering?

Thanks.

book value is 1.3B, current offer less than $700M, bidder reported by Bloomberg as sembcorp. the amt is not even enough to pay off secured creditor, let alone perp and pref shareholders.