SINGAPORE – The High Court on Wednesday (Jan 29) granted another extension of Hyflux’s debt moratorium to Feb 28 following a surprise application by its lawyers from WongPartnership to discharge themselves from representing the distressed water treatment firm.
It is believed that WongPartnership sought to discharge themselves because of a loss of confidence and good trust between the law firm and Hyflux.
A one-week adjournment was given for matters to either be resolved between WongPartnership and Hyflux or for new lawyers to be brought in to represent the firm.
Justice Aedit Abdullah on Wednesday morning said: “The fairest course of action is a short adjournment for Hyflux to consider alternative (legal) representation or whether it can resolve matters with WongPartnership.”
Justice Aedit noted that “this is a significant development we hope will be resolved.”
“There are still some concerns by the unsecured working group (UWG) of banks regarding other financial advisors’ payments. .. There are some questions over whether the scheme will be supported. … We hope to resolve these matters by the next hearing,” he added.
Hyflux finally reached a $400 million rescue deal with United Arab Emirates utility company Utico in November last year. Its various creditor groups need to sign off on the plan.
A hearing is scheduled on Jan 20 to hear applications for a further extension on the debt moratorium beyond Feb 28, and to consider what the positions of the various parties are.
The UWG group comprises seven unsecured banks, including BNP Paribas, Mizuho Bank, KFW IPEX-Bank, Bangkok Bank and Standard Chartered Bank. They are represented by Eddee Ng, senior partner at Tan Kok Quan Partnership.
WongPartnership lawyer Manoj Sandrasegara, who has been representing Hyflux, told the court: “In two weeks we will be before the Judge for formal discharge”
“What this illustrates is the … problems that arise when you have a large pool of retail investors, and things go belly-up and they need to be given financial and legal advice. Some provision has to be made for that,” Justice Aedit added.