Hyflux did not reveal power plant plan initially to avoid strategy leak, says defence

Hyflux did not initially tell potential bank lenders about plans to build a power plant, as it wanted to ensure “there was no leak of its bidding strategy to competitors” before it submitted its bid for the Tuaspring project, the defence told the State Courts on Oct 28.

- Grace Leong Senior Correspondent

In trying to show that there was nothing untoward about Hyflux not revealing its power strategy initially, lawyer Jaikanth Shankar - part of the legal team representing Hyflux founder Olivia Lum - cited earlier trial testimony from Mr Nah Tien Liang.

Mr Nah, who is Hyflux’s former vice-president of investment, had made reference to an Oct 8, 2010 mandate letter, which spells out the conditions under which Hyflux and the consortium of banks will work towards a loan facility.

He had said that this letter did not reference the power plant because Hyflux viewed the power plant as being “very strategic”, Mr Shankar noted in his cross-examination of Sumitomo Mitsui Banking Corporation (SMBC) executive Jeanne Soh.

But after its bid was submitted on Oct 21, 2010, Mr Shankar said Hyflux voluntarily and openly shared its confidential information with the banks, including its bidding strategy and the power plant.

Ms Soh said she did not remember if Hyflux’s power strategy was shared with SMBC.

“But there was information shared with us,” said Ms Soh, now a managing director for structured finance at SMBC.

The consortium of banks comprised SMBC, DBS, Mizuho Corporate Bank, BNP Paribas, MUFG and ANZ.

In October 2010, they issued in-principle commitment to Hyflux’s $527 million term loan request, for its bid for the desalination project tender from national water agency PUB.

However, the banks did not know until November 2010 that the Tuaspring project included a power plant as well.