This morning, it was reported that SGX Listed Hyflux, Singapore’s prominent water treatment firm, is considering to seek court protection to facilitate negotiations with creditors.
Hyflux wasn’t in a good position. Hasn’t been for a long time. While it is one of the poster child for the government, investors have not taken a liking to the company.
And it is not hard to tell why. When you look at the balance sheets, income statement, it does not give you good account that you should further explore this business.
However, what is appealing is its perpetual securities and preference shares. Hyflux has high debt, a business that is not cash flowing for some time, and people question whether they will default on its perpetual securities and preference shares payment.
They are indeed appealing as they are far below par value, and give a very high yield, should Hyflux be able ......