Noble Group Ltd.’s week of woe just got worse as the commodity trader, which has defaulted on its debt and seen founder Richard Elman quit the board, said that it’s being sued by an Indonesian coal producer for more than a quarter of a billion dollars.
The Hong Kong-based trader “has become aware” that PT Atlas Resources has filed a lawsuit in Indonesia against the company seeking compensation of more than $260 million, it said in a statement on Friday. “The company is not aware of the grounds for the claim or any further details relating to the same. Nonetheless, the company intends to vigorously defend any claim if served.”
Once Asia’s largest commodity trader, Noble Group has faced a mounting crisis over the past three years as it lost billions of dollars, parried criticism of its accounts and sold assets in a bid to survive. Chairman Paul Brough is now racing to push through a restructuring, which will hand control to creditors. The case from PT Atlas highlights the mounting risks to that complex plan.
On Thursday, Noble Group said that it’s possible, though unlikely, bondholders could force it into liquidation, although it argued that any attempt by creditors to wind it up after the default would likely fail. That followed a blow on Tuesday, when major shareholder Goldilocks Investment Co. sued the company. Elman’s resignation as a non-executive director was announced midweek.