SINGAPORE: As the crucial sale of its biggest water and power plant remains a work in progress, Hyflux being in advanced talks with at least two potential strategic investors has been described by some analysts as a welcomed update amid a closely-watched restructuring process. 

The beleaguered water treatment firm, which shockingly announced a court-supervised reorganisation of its business in May and later obtained an additional six-month moratorium in June, said on Monday (Oct 8) that it is “moving very quickly” in terms of discussing possible new financing with strategic investors. 

It is in advanced talks with at least two potential parties and hopes to conclude them by November, its legal advisors from WongPartnership told the court during a status conference.

Deals with strategic investors will help to determine if the company’s debts can be paid in full and pave the way for negotiations on the terms of restructuring with various creditor groups, the lawyers added. 

After the seeming lack of progress over the past months, CMC Markets’ Singapore-based sales trader Oriano Lizza is viewing the update as “a positive” for now. 

“Without information on who they are and their approach to investing in Hyflux, it’ll be difficult to give an assessment but what’s promising is the interest in Hyflux,” he said.

“But we haven’t heard much since the moratorium was granted … so this is a positive.”

iFast Corp’s senior fixed income analyst Ang Chung Yuh said it helps to shed some visibility on the restructuring process given the uncertainties that continue to cloud the divestment of Hyflux’s single largest asset, the Tuaspring Integrated Water and Power Plant. 

“In that sense, getting rescue financing or strategic investments might play a bigger role in determining the eventual recovery for all stakeholders.”

SELLING TUASPRING: TOUGH BUT ESSENTIAL

Still, analysts said the sale of Tuaspring remains key as Hyflux races against time to fix a dwindling cash pile amid mounting debt. 

Of its S$2.95 billion of liabilities, S$265 million is owed to medium-term note holders and another S$900 million to investors of perpetual securities and preference shares. The latter is a big group of 34,000 people, with many of them being retail investors. 

Meanwhile, it was also revealed at the status conference that Hyflux has been unable to pay rent for its two office premises over the past month, according to lawyers for the trustee of Ascendas Real Estate Investment Trust. 

With a book value of S$1.3 billion, the divestment of the Tuaspring plant at the right price will “loosen the noose” around Hyflux’s neck, said investment specialist S. Nallakaruppan. 

“Strategic investors taking a stake may help with the turnaround but Hyflux’s debt is humongous. It needs to reduce its gearing and divesting of assets must be priority.” 

But market watchers acknowledge that the process isn’t as straight-forward with the integrated plant being a strategic water asset in Singapore. Approval from the national water agency PUB is required “every step of the way”, founder-CEO Olivia Lum had said previously.

“This is not a transaction where you just have two private parties talking. In this case, there are gatekeepers involved,” said OCBC Bank’s credit analyst Ezien Hoo.

Still, given that it is nearly four months into the moratorium, Ms Hoo said expectations were for “more colour” to be unveiled during Monday’s status conference, such as the number of bidders, so that “investors can have some sense of whether they are getting zero or a bit more”. 

“(Maybe) they are trying to get more bidders into the picture.” 

As part of an agreement with Maybank, Tuaspring’s only secured creditor, Hyflux has until Oct 15 to sign a binding purchase agreement with a successful buyer for Tuaspring. Final bids had to be in by Oct 1. 

Sembcorp Industries was reportedly the only party to submit a final bid, with the Bloomberg article adding that the bid was below Tuaspring’s book value and will not be enough to fully pay back loans. 

At the status conference, WongPartnership lawyers would only say that Hyflux is “proceeding towards” the deadline and that “there could be other conversations with Maybank on the process itself”. 

Meanwhile, in Ms Lum’s affidavit released after Monday’s hearing, it is written that there is now a “select number of pre-qualified parties” – names of potential investors that have been approved by PUB and permitted access to a limited set of confidential information.

As there is no guarantee that a pre-qualified party will proceed with a bid, Ms Lum said the firm is exploring all options, which includes increasing the number of pre-qualified parties so as to “optimise competitive tension to improve the realisable value of Hyflux’s interest in Tuaspring”. 

NEED FOR UPDATES 

With the next hearing scheduled for Oct 31, analysts are hoping to hear more details by then.

iFast’s Mr Ang, for one, wants to know the outcome of the plant’s valuation process conducted by the appointed valuers. “If it is below expectations, what will Hyflux do?” 

He added: “Also, if the Oct 15 deadline is not met, will there be an extension? If there is one, is Maybank asking for more to protect its interests?” 

Such updates will be necessary given that Hyflux will most likely request for an extended reprieve from creditors by the time its moratorium expires in mid-Dec, analysts told Channel NewsAsia. 

“In the agreement with Maybank, for example, the timeline to get shareholder approval for the sale is in February – 2 months after the moratorium ends,” said Mr Ang. “So the company already has some expectations of getting an extension.” 

“While restructuring processes tend to be protracted and Hyflux should be given space to discuss and get the best deals, it will probably still have to show some progress to get it,” he added. 

On Monday, Justice Aedit Abdullah said it would be “an uphill task” for Hyflux to request for a moratorium extension without showing concrete progress on its restructuring plans.

SINGAPORE: It was just after 4pm when one of my managers and I kicked off our weekly catch up.

We went through the usual numbers, and after going through a few other items, eventually arrived at the finale – me letting her know about a behavioural issue a couple of her subordinates expressed discomfort with.

She has this habit of whispering at parts of her conversation. And when she does that with others, those not involved in that conversation become uncomfortable. Some get the impression she may be saying bad things behind their back even though she isn’t.

That feedback appears well accepted (and delivered, in my opinion), and we continued to cover a couple more other issues. I think to myself I am on track to knock off at 6pm to grab an early dinner with the family.

Then things went south.

Returning to the feedback I gave her, her face tensed up, her voice got louder and her eyes watered up.

She felt that it was unjustified, that her contribution wasn’t recognised. Before I knew it, I’d spent another hour making sure she was alright.

If you think dealing with people is tough, wait until you give them feedback.

IS FEEDBACK REALLY THAT DIFFICULT?

But come to think of it, delivering feedback isn’t really tough. Just ask anyone you know with low Emotional Quotient (EQ).

It is the negative response you get from the recipient that is difficult to process and makes giving feedback unpleasant. Which doesn’t really affect folks with low EQ who are more than happy to dish out the harshest yet most frank and direct criticism.

But being on the receiving end of negative responses to feedback is not something people like me are comfortable with.

Which leads many of us to accumulate and hold back most information about performance until the year-end performance review session.

This is when managers tell you in December what you did right or wrong in January. When you think you had a good work year because nobody said anything, you might get a rude shock hearing that you messed up really bad.

FEEDBACK OUGHT TO BE TIMELY

Back to the feedback I was trying to give my staff.

In honesty, I had observed her habit of whispering before others brought it to my attention. I also found it a little uncomforting but I did what lazy managers would do – I ignored it.

If I had just pulled her aside and told her about this when it first began, or at the point where she was doing it, her reaction might be more tempered.

This and many other episodes in life have taught me that feedback (just like vitamins) are best given in micro doses frequently and when you need it the most.

And the company performance management structure should encourage that by firstly doing away with annual performance reviews because it motivates managers to kick the can down the road.   

Forward-looking companies, such as Adobe, have already retired performance reviews. Adobe replaced theirs with Check-in, a performance management approach that prioritises an ongoing process of feedback and dialogues between managers and employees.

READ: Get rid of middle managers? Do so at your own peril, a commentary

A human resources team also provides support for employees and their managers to have constructive conversations.

I can already hear the angry cries of protest from companies that don’t possess the financials like Adobe to reinvent performance reviews. But one doesn’t have to look far to make use of HR Tech platforms such as EngageRocket, Synergita or SelfDrvn to enable more frequent check-ins between employees and their managers.

At the end of the day, having an effective feedback system might boil down to attitudes. Be like Jack Ma and carry the heart of a teacher.

READ: Alibaba’s most innovative move to date? Jack Ma’s graceful corporate exit, a commentary

This includes having the acumen and grace in allowing and aiding your people to outshine you, and that can only be achieved through giving your acute observations of what they are and aren’t doing, and your prompt feedback about what’s working and what’s not.

Even for the most cynical managers who might be sceptical – remember that if the football team performs well, the manager gets the credit.

COMMUNICATING IS A KEY FUNCTION OF LEADERSHIP

People management isn’t just sending memos of instructions for execution. A huge chunk of your time as a manager is expected to be spent on communicating.

Which also brings us to another aspect of management – leadership.

Like it or not, your subordinates will look to you for guidance and direction.

And as a leader within the organisation, it’s incumbent on you to think about how to enhance the talent you have in your organisation at various junctures. Most of them require communication, whether it’s a pat on the back or someone pointing out a common mistake.

READ: How to deal with everyday injustices at the office, a commentary

READ: How to deal with your team members’ personal crises, a commentary

Giving feedback should not be viewed as an additional chore that is secondary to the role of a manager but, instead, an integral aspect of leadership in seizing opportunities to shape team performance and deliver business outcomes.

In doing so, you demonstrate your commitment to the worth of your people. That is a choice you make as a leader every day.

Adrian Tan is co-founder of The Resource Group, a boutique HR consulting agency that specialises in HR and grant consultancy for SMEs. He is the recipient of the SHRI HR Entrepreneur of the Year in 2013 and writes regularly about HR at adriantan.com.sg.

SINGAPORE: Prime Minister Lee Hsien Loong will be in Bali, Indonesia, on a two-day visit from Wednesday (Oct 10) to attend the Singapore-Indonesia Leaders’ Retreat and ASEAN Leaders’ gathering, a statement from the Prime Minister’s Office (PMO) said.

The Leaders Retreat will be Mr Lee’s third with Indonesia’s President Joko Widodo. The previous Retreat was held in Singapore in September 2017 and commemorated the 50th anniversary of the establishment of diplomatic relations between the two countries.

During their meeting, PM Lee and President Widodo will review the progress made in bilateral relations, and discuss ways to deepen cooperation, PMO said.

“The leaders will also exchange views on regional and international developments,” it added.

At the retreat, the two leaders will witness the signing of several agreements and memoranda of understanding. They include an agreement on the Promotion and Protection of Investments (Bilateral Investment Treaty), a cultural cooperation programme as well as a Memorandum of Understanding on financial technology cooperation.

At the ASEAN Leader’s gathering, Mr Lee will co-chair discussions on sustainable development along with Mr Widodo. Apart from ASEAN leaders, the gathering will also involve the heads of the United Nations, International Monetary Fund and World Bank Group (WBG), PMO said.

Mr Lee will also take part in a moderated dialogue with WBG President Jim Yong Kim at the group’s third annual Human Capital Summit.

PM Lee will be accompanied by Deputy Prime Minister Teo Chee Hean, Minister for Defence Ng Eng Hen, Minister for Foreign Affairs Vivian Balakrishnan and other government ministers.

In Mr Lee’s absence, Minister for Home Affairs and Minister for Law K Shanmugam will be acting prime minister. 

SINGAPORE: More nurses from SingHealth are being seconded to the Singapore Civil Defence Force (SCDF), under a collaboration designed to help the public respond more effectively to health emergencies.

There are now 13 nurses on board, up from four in 2011. The move seems to be paying off, with more instances of bystanders performing cardiopulmonary resuscitation (CPR).

When members of the public dial 995, the call goes to the SCDF Operations Centre where it’s answered by an SCDF officer. But if it’s a medical emergency, such as if a person is not breathing, the call is passed on to a nurse.

Most callers are anxious so nurses will calm them down, get enough information to make an initial diagnosis and walk them through what needs to be done step by step. For instance, if someone is having a cardiac arrest, the caller will be told how to perform a simplified version of CPR.

The idea is that if you can follow simple instructions you can save lives, said SCDF’s Chief Medical Officer Shalini Arulanandam, and having nurses on the other end of the line has its advantages.

“The advantage is when a caller is distressed and needs to be calmed down and given instructions on the phone, the nurses are able to relate to them, and give medical advice. 

“They don’t have to follow a computerised system – a fixed script – they can use their clinical expertise to guide the conversation and their interpersonal skills,” said Dr Shalini.

The importance of early intervention is not lost on 30-year-old Geraldine Goh, a senior staff nurse at Singapore General Hospital. Ms Goh has been a nurse for a decade and has spent the last four years seconded to the call centre.

“My dad, he passed away back in 1998, he died of a cardiac arrest in a carpark and at that point in time, there was no (such thing as) bystander CPR. So this job motivated and inspired me to help other people,” said Ms Goh.

Each call that Ms Goh answers clocks in below eleven minutes – the time it typically takes for an ambulance to arrive. Over the years, she has coached callers through childbirth and taught them how to resuscitate patients.

SCDF says the move to have trained professionals at the call centre has contributed to the number of CPRs performed by members of the public. Of the cardiac arrest victims given CPR in 2011, 22 per cent were administered by bystanders. This went up to nearly 55 per cent in 2015.

The collaboration with SingHealth began in 2011 and was formalised in an agreement last year. It includes giving the nurses access to the National Electronic Health Record.

“They can also do a quick search into a particular patient’s records to see if they have known history of having a heart attack before or breathing condition and this is important information relayed to paramedics on the ground,” said Dr Shalini. “This will also enable paramedics to improve their care and give certain interventions.”

Under the agreement, nurses also conduct research to improve the triage process such as how to better frame questions to get the desired responses in a shorter time.

SINGAPORE: The defence in the landmark Aljunied-Hougang Town Council (AHTC) trial argued on Tuesday (Oct 9) that there was also conflict of interest at a company which served as managing agent of other town councils in Singapore.

CPG Facilities Management was Aljunied Town Council’s managing agent when it was under the People’s Action Party (PAP). The company also serves Ang Mo Kio Town Council.

According to defence lawyer Chelva Retnam Rajah, the managing director of CPG Mr Jeffrey Chua had shares in CPG’s holding company. Mr Chua was also secretary of Aljunied Town Council.

In his cross-examination of the first plaintiff’s witness, KPMG executive director Owen Hawkes, Mr Rajah asked if he knew of Mr Chua’s interests in CPG.

Mr Hawkes admitted that he did not.

“Without knowledge of what proportion of the shares this equates to, it’s difficult to determine degree of conflict of interest,” Mr Hawkes said.

“Large or small, it would give him a profit motive,” the defence countered. Mr Hawkes agreed.

In his answers to Mr Rajah, Mr Hawkes also explained that “there are conflicts of interest in practically every area of business”. 

“The question is not whether there is a conflict of interest. The question is how severe is it and what are the steps taken to manage it,” he said.

WHAT CONSTITUTES CONFLICT OF INTEREST?

The question of what exactly constitutes “conflict of interest” was raised at length on Tuesday, and why two of the defendants were considered “conflicted persons” as listed in KPMG’s October 2016 report.

Ms How Weng Fan and her late husband Danny Loh both held dual roles in AHTC as well as its former managing agent FM Solutions and Services (FMSS), which allegedly received “improper payments” from the town council.

Ms How was AHTC’s deputy secretary and a shareholder of FMSS at the same time.

Her husband, who died in an accident in 2015, was AHTC secretary as well as the owner of both FMSS and its service provider FM Solutions & Integrated Services (FMSI).

READ: An ‘egregious, cavalier misuse of public funds’: Town council lawyers rip into Workers’ Party leaders

Mr Rajah represents Workers’ Party (WP) Members of Parliament Sylvia Lim, Low Thia Khiang and Pritam Singh, as well as AHTC councillors Chua Zhi Hon and Kenneth Foo Seck Guan.

They, along with Ms How, Mr Loh and FMSS itself, are being sued by AHTC and Pasir Ris-Punggol Town Council (PRPTC) for breaching their fiduciary duties and for the alleged improper payments worth more than S$33 million.

When asked by Mr Rajah about what would and would not constitute a conflict of interest, Mr Hawkes refrained from defining it within what he called “a binary”.

Instead, he explained that “there is a spectrum between not having a conflict (on one end) to the final end where you may have conflicts that are so severe that no controls can manage the conflicts of interest involved”. 

“If you are a direct shareholder in a company, you are slightly further on the spectrum than the spouse of a shareholder,” he said.

In a hypothetical situation posed to him by Mr Rajah, Mr Hawkes explained why Ms How being the spouse of Mr Loh, a shareholder of FMSS, in this context would create conflicts of interest: “If Mr Loh owned 100 per cent of FMSS and (Ms How) was his wife, then as a single family unit, the money that goes to him … also goes to her.”

According to the KPMG report, there was “an unacceptably high degree of abdication of control to the conflicted persons” in AHTC. This also involved what KPMG said was “an absence of meaningful oversight by the town councillors over FMSS’ running of the town council’s management function”. 

This, in turn, “exposed public funds to the risk of improper use and application”, the report charges.

RETAINING CPG WOULD HAVE SAVED TOWN COUNCIL ABOUT S$1.2M: KPMG

After it won Aljunied GRC in the 2011 General Election, WP assumed management of ATC, whose managing agent then was CPG.

ATC later merged with Hougang Town Council to become AHTC.

It is the claim of the defendants that CPG wanted to be released from the managing agent contract as “it would be bad for CPG’s business to be serving PAP town councils as well as a town council run by the opposition party”.

However, the plaintiffs charge that WP MPs Sylvia Lim and Low Thia Khiang “decided that CPG would be released from its contractual obligations”, despite having two more years on its contract, “so as to make way for FMSS”.

READ: Hard for opposition town councils to find managing agents, AHTC’s previous vendor an ‘unwilling horse’, says defence

READ: Workers’ Party took on a town council which was ‘stripped of its computer system’, says defence

In its report, KPMG had estimated “conservatively” that AHTC paid S$1.2 million more than it would have, if it had held CPG to its contract. 

In his cross-examination of KPMG’s Mr Hawkes, Mr Rajah questioned “the assumption that CPG was prepared to take on the Hougang division at the same rates that it was operating (at) for the other units in Aljunied town”.

In addition, he said: “If CPG did not wish to take on Hougang division, then you can’t force CPG to accept it, correct?”

Mr Hawkes replied that CPG was under a contract that AHTC could have held them to.

Mr Rajah’s response: “We don’t accept that CPG would have been willing to take over this contract.”

The trial goes into its fourth day on Wednesday, with Mr Rajah expected to wrap up his cross-examination of Mr Hawkes.