SINGAPORE (Bernama): Malaysian bank BHD (Maybank) has decided to terminate the collaboration agreement for the transfer of the integrated water and energy plant of Tuaspring (IWPP), with immediate effect, said water treatment company Hyflux Ltd.
The Singapore-based company announced today that it has received a letter from Maybank which ends the agreement signed with Hyflux and its Tuaspring Pte Ltd unit in July 2018.
Under the agreement, indebted Hyflux and Tuaspring Pte Ltd have agreed to sign a binding agreement with a successful bidder / bidder for the full settlement and settlement of Maybank's total liability for the "standstill period".
However, to date, there has been no binding agreement with a winning bidder / investor for the six-fold deadline, Hyflux said in a filing on the Singapore Stock Exchange.
"(According to Maybank,) this constitutes a breach that is incapable of solution under the collaboration agreement that authorizes Maybank to terminate the collaboration agreement," he added.
Maybank is the sole guarantor of Tuaspring with a reported exposure of about S $ 602.4 million for the last IWPP.
Singapore's national water agency, the Public Utilities Board (PUB), on 17 April issued a notice to Tuaspring to rescind its water purchase agreement with Hyflux in order to safeguard the country's water security. The notice of termination provides for a notice period of 30 days before PUB takes over the Tuaspring desalination plant.
Hyflux is currently struggling to restructure its debt with its liabilities, which were reported to be $ 2.95 billion as of March 31, 2018.
Hyflux also announced today that it has received notifications from Maybank to PUB and the Singapore Energy Market Authority regarding the direct agreement between Tuaspring, PUB and the bank dated November 21, 2013.
"These notices concern an enforcement event and the acceleration of the maturity of all amounts due in Tuaspring's financing documents," he said.
Maybank also stated its intention to appoint receivers and administrators over Tuaspring's assets, except for the "desalination plant and shared infrastructure".
In the meantime, Hyflux said that the plant's operations at Tuaspring's IWPP should continue as usual.
It is expected that the termination of the collaboration agreement will have a significant impact on the group's financial performance.
Hyflux said it would make the appropriate announcements when and when there was any further material development on this subject.