SGX Regco asks Noble's creditors to reconsider restructuring scheme

Singapore Exchange Regulation (SGX Regco) is the latest body to ask Noble Group and its senior creditors to reconsider its restructuring scheme to allow shareholders to freely vote on it.

Noble has struck a restructuring support agreement with creditors holding 55 per cent of its senior debt. It requires approval by a majority of existing senior creditors representing 75 per cent of its debt.

Noble would move its assets into a new firm, with shareholders receiving a 10 per cent stake in the restructured entity.

If shareholders vote against this proposal, the group will take the route of an alternative restructuring. This will see it apply for an administrative order in Britain to sell its assets into the new firm.

In this scenario, shareholders who had voted in favour of primary restructuring are entitled to shares in the new firm as they would have if the proposal was passed. But investors who voted against it will not get the shares.

SGX Regco disagreed with this clause. It stated that how a shareholder votes on the primary restructuring should not have any bearing on whether he or she would be entitled to shares in the new firm under the alternative restructuring.

The SGX Regco statement was lauded by the Securities Investors Association (Singapore) president David Gerald, who said: "It will not be fair for the shareholders who vote against not to receive any shares in the new company."- THE STRAITS TIMES .