Noble gets reprieve through 4-month credit extension

This article is more than 12 months old

Jun 20, 2017 06:00 am

HONG KONG/SINGAPORE: A four-month credit extension for cash-strapped Noble Group Ltd sent the commodity trader's shares up almost 50 per cent yesterday, though experts warned the reprieve was likely to be only temporary.

The Singapore-listed firm on Friday persuaded banks to extend a $2 billion credit line, due to be rolled over by the end of this week, but it was asked to find a strategic investor, a person familiar with the matter told Reuters.

Noble, which has been seeking a cash injection for months, declined to comment on the credit line. "Any roll over is significant, purely because it allows this company to function for another four months," said trading strategist Nicholas Teo at KGI Securities Singapore. "It doesn't mean (Noble) is completely clear."

Noble's decimated stock soared, closing up 46 per cent at just under $0.48. While this is the biggest percentage gain in 18 years, the value of the stock is still only a fraction of its 2011 peak price of about $17 ($12.30).

At its height, Hong Kong-based Noble was Asia's largest commodity trader, a powerhouse in coal and oil to rival larger European players like Glencore. - REUTERS