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Singapore’s highest-profile distressed company, Hyflux Ltd., faces more woes after its legal adviser said it plans to walk off.

WongPartnership LLP has expressed its intent to resign from the case due to “loss of confidence in a good cause,” Singapore high court judge Aedit Abdullah said on Wednesday in a hearing where Hyflux sought to extend its debt moratorium by three more months.

This forced the court to adjourn the hearing to Feb. 20, while asking for a reconciliation between WongPartnership and the company, if possible. “On Feb. 20, we will be before the judge for a formal discharge,” Manoj Sandrasegara, partner at WongPartnership, said in the hearing on Wednesday.

Hyflux’s fall has left some 34,000 retail investors in the lurch. The case shows few signs of a resolution emerging after more than 18 months under court supervision.

Hyflux will have to appoint a new legal adviser if it is unable to sort out the dispute with WongPartnership. The court cited a point under Singapore’s legal professional conduct rules that allows a law firm to withdraw from representing a client in a case where “there is a serious loss of confidence” between them.

Meanwhile, the court extended Hyflux’s debt moratorium by a month to Feb. 28.

‘Painful Process’ Stings Hyflux Investors Facing Near-Total Loss

Crisis-Hit Hyflux’s Debt Plan Faces S$40 Million Fee Hurdle

The drawn-out process is causing angst among Hyflux investors. Middle Eastern utility Utico FZC, which reached a pact in November to rescue Hyflux, has already expressed its frustration over the delay in closing the deal. It has threatened to walk away if it can’t win investor support for its offer.

Investors have been left facing more uncertainty after a mystery rival suitor called Aqua Munda Pte made a surprise offer last month to buy the company’s debt. As the two companies are locked in a battle for control of Hyflux, there’s still no clear timeline on when the debt of the noteholders will get settled.

To contact the reporter on this story: Ameya Karve in Singapore at akarve@bloomberg.net

To contact the editors responsible for this story: Andrew Monahan at amonahan@bloomberg.net, Denise Wee

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