Investors Set to Lose Up to 90% on Singapore Water Debacle
- Some 34,000 retail investors stand to lose up to 90 percent
- Collapse is latest of 15 credit-market shocks in four years
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The catastrophic slump of Singapore’s much-vaunted water and power company, Hyflux Ltd., has stunned 34,000 retail investors who were lured by the promise of a 6 percent annual return forever from a company that seemed to have a gold seal of government approval.
At the heart of the debacle is Tuaspring, a desalination and power plant that cost S$1.1 billion ($809 million) and was heralded as one of the “national taps” for an island that had long depended on importing water and harvesting rainwater for survival. The company’s glowing prospects encouraged investors including Li Meicheng and Violet Seow to funnel some of their savings into S$900 million of junior debt to help fund the venture and group expansion.