Date: June 3, 2020
A number of P&Ps have contacted SIAS to express their serious concerns about the current state of affairs at Hyflux. SIAS notes also with utmost serious concerns of the press reports that the company and some of its directors are under criminal investigation for suspected false and misleading statements, as well as non-compliance with accounting standards. This is a troubling situation for all stakeholders of Hyflux.
Hyflux Board has to decide whether it can or cannot find the white knight to salvage the company. Two years have passed and to-date it has not succeeded in successfully restructuring the company. After SMI deal failed, Utico came on the scene but there is still no completed deal. Notably Utico was not willing to disclose to the P&Ps its financial position.
Although it may not affect the current Board from negotiating a deal with a new party, it cannot be denied that its credibility is now in question. Where directors are under investigation of serious offences, they must ask themselves whether they should step aside and allow new directors, especially independent directors with expertise and fresh mind to deal with new offers. As early as January 2019, SIAS called on Hyflux Board to step down. If the Board stays on, it must work harder and be willing to communicate better with its stakeholders in a timely manner. SIAS is disappointed that the Board has on numerous occasion fail to respond to questions raised on behalf of our retail investors in Hyflux.
SIAS has been approached by investors who are bond holders as well as P&Ps to ask if we would help to initiate legal action against the directors. SIAS knows that such an initiative now would affect any restructuring plan. We have advised the investors interested in legal action to seek their own legal counsel or wait for the right time that would warrant such an action.
SIAS still hopes that the Hyflux Board will do the right thing expeditiously in the interest of all investors who have put their faith in them and were ready to part with their money on the basis on what was put out in their documents.
Founder, President & CEO