Barely a week after Prime Minister Lee Hsien Loong and Ho Ching went to Bali for a retreat with Indonesia Prime Minister Joko Widodo, Singapore’s water treatment company Hyflux shortly announced that it has been sold to Indonesia government-linked consortium, Salim Group and Medco Group.
Hyflux’s CEO, Olivia Lum – a personal friend of Ho Ching – yesterday (Oct 18) announced that Indonesia will now have 60% ownership of the water treatment company. The Indonesian consortium pumped S$400 million for the majority shareholding, a S$130 million shareholder loan and a further S$30 million loan for its interim operations until the deal is signed. Olivia Lum also announced that the Tuaspring power plant will no longer be for sale.
The sale of Hyflux would mean Singapore’s two water desalination plants – Singspring and Tuaspring – will now be owned by Indonesia. The two plants supplies up to 25% of Singapore’s water needs, and it is unknown whether water prices will increase further.
Earlier in 2017, Prime Minister Lee Hsien Loong tried to help his wife’s friend by raising water prices by 30%. The legalised corruption however failed to help Hyflux as the company was heavily debt-ridden from its bond issuance. Hyflux currently holds a S$2.6 billion debt, and it received court protection after it failed to return for a S$500 million 6%-interest rate bond in June 2018.