Back then, Hatten was bullish, bold and even brash. It spoke about becoming a leading Southeast Asian developer riding the rising tide of regional demand for quality integrated developments.
For all that talk, it remained rooted, even trapped, in a single geography: Melaka. Its portfolio, strategy and risks were overwhelmingly concentrated in one state in Malaysia, a market that has lurched between optimism and severe oversupply for years. That concentration in Melaka would eventually magnify Hatten’s every misstep.
Hatten’s story is also one of personalities. When it made its trading debut on SGX, its top brass consisted of two brothers in their early 30s. Colin Tan, then 33, was the executive chairman and managing director, while his brother Edwin, a year older, was the deputy MD and executive director.
Both had been mentored by their father, Eric Tan, a familiar figure in Melaka’s property circles. The patriarch wasn’t officially part of Hatten as he was an undischarged bankrupt at the time of its listing on SGX.
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The family’s deep involvement in both vision and execution made governance concerns hard to shake off, even as Hatten talked up its integrated developments and regional aspirations.
When Covid hit, Hatten did what many companies hurt by the pandemic tried to do: reinvent itself. It also tried to sell a subsidiary that was more than halfway through building an integrated development comprising a mall, a luxury hotel and a theme park. However, work stalled after a fallout with the main contractor. The divestment, had it gone through, would have earned Hatten US$323 million.
While some diversifications were measured, Hatten’s pivot seemed scattershot. Bitcoin mining became a headline act. It also wanted to develop and monetise crypto exchanges, metaverses and non-fungible tokens. E-sports followed, with plans to turn one of its Melaka malls into a hub for major multiplayer gaming competitions.
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In a rare moment of unity, shareholders voted unanimously in 2021 to approve these new ventures.
The hype faded quickly, though. None of those ventures took off with the scale or commercial traction needed to offset Hatten’s woes. They delivered no meaningful uplift, no new anchors, and certainly no fresh momentum. By then, cracks had widened everywhere else.
Creditors at the door
Between 2022 and last year, Hatten and some of its subsidiaries received legal letters from creditors demanding repayment. Haitong Securities, HSBC and others queued up. The group’s huge debt load was no longer tenable.
With construction delayed and cash flow tightening, Hatten’s signature developments stalled. Efforts to revive or repurpose assets kept running into market realities: Melaka’s property glut, rising costs and diminishing investor confidence.
One such effort was a proposed partnership with Quantum Health, another SGX-listed firm, to convert one of Hatten’s malls into Melaka’s first overseas specialist outpatient centre. The deal never materialised.
In March 2024, Hatten appointed Deloitte & Touche Financial Advisory Services to work with creditors, a sign that liquidity pressure had become acute. By August last year, the situation had deteriorated to the point where Hatten was placed under judicial management. Its shares were suspended from trading. Minority shareholders, many of whom had held on through years of corporate reinvention, were left with little clarity about what would come next.
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There’s an almost uncanny parallel unfolding in the background. Early this year, Eric Tan, who was discharged from bankruptcy in February 2018, became managing director of Capital World, another SGX-listed property developer grappling with project delays, creditor pressure and buyer disputes in Malaysia. Tan’s wife and daughter emerged as substantial shareholders of Capital World after a $2 million convertible loan they extended in 2022 was capitalised into shares.
In January 2023, Capital World announced the sale of most of the retail space at its long-shuttered Capital City Mall in Johor Bahru to Singapore retailer Mustafa for RM368 million. The mall, opened in 2018 but closed in 2020 amid financial troubles, was supposed to reopen by end-2023 with Mustafa as owner-operator. It remains shut.
A new backdoor listing
Back to the irony: Hatten, born on SGX through a costly RTO, is now seeking salvation through another backdoor listing. Just a few weeks ago, it announced a $24 million acquisition of Singapore construction firm Metrocon, which earned a net profit of $2 million on revenue of $41 million for the first nine months of this year. Hatten will fully fund the purchase by issuing new shares.
It’s a full-circle moment, and perhaps Hatten’s final realistic chance of survival as a listed entity. For minority shareholders who have endured years of stalled projects, failed diversifications and unsustainable debt, the RTO target may be the first tangible source of hope in a long while.
But hope will need to be tempered with scrutiny. After years of volatility and misalignment between ambition and delivery, investors deserve transparency, strict governance and a credible restructuring plan.
Whether this RTO marks a genuine turning point or simply another detour depends on execution, something Hatten has struggled with time and again. For the sake of its minority shareholders and the credibility of Singapore’s market for troubled listings, one can only hope this time is different.
