Singapore: Noble Group chairman Elman increases holding as shares sink

Noble Group Ltd.’s Richard Elman boosted his stake in the company that he founded as its shares sank to the lowest level since 2008.

Elman bought 10 million shares in Asia’s top commodity trader on Friday for S$3.19 million ($2.2 million), raising his holding to 22.13 percent, according to a statement to the Singapore exchange on Monday. After news of the purchase, the stock lost as much as 8.8 percent to 31 Singapore cents, and was at 31.5 cents at 9:27 a.m. local time.

Noble Group sank last week after Standard & Poor’s joined Moody’s Investors Service in cutting its rating on the company to junk amid concern about its liquidity as commodity prices slump. The shares lost 65 percent in 2015 amid attacks on its accounts by critics including a group calling itself Iceberg Research. The company rejected the allegations and has sought to reassure investors by cutting debt, selling assets and boosting transparency, with Elman pledging to shareholders last June to “right the damage.”

Elman, a former scrap-yard worker who dropped out of school at 15, built Noble Group into Asia’s largest commodity trading company by revenue. He worked at another trader, Phibro, before setting up his own firm with $100,000 in savings in Hong Kong. He remains Noble Group’s biggest owner, according to data tracked by Bloomberg.

Stake Sale

Noble Group has made efforts to buoy its creditworthiness as its shares slumped. It agreed in December to sell the remaining 49 percent of its agricultural unit to Cofco Corp., China’s top food company, for at least $750 million to reduce debt. Cofco already owned the other 51 percent of NobleAgri, bought for $1.5 billion in 2014.

Even after the deal, S&P said that liquidity, or short-term financing, was no longer strong enough to sustain Noble Group’s investment-grade credit rating. The outlook for the commodity trader’s “capital raising could be complicated by depressed” raw-materials markets, it said.

Noble Group said last week that an increase in calls for collateral, or demands it set aside more cash to guarantee trades, after the downgrades was still below the $100 million to $200 million range that Chief Executive Yusuf Alireza had estimated in comments to analysts last year. The company will receive about $200 million after selling receivables to shore up its balance sheet, according to people with knowledge of the matter.

Also Read:

Noble CEO says Moody’s rating does not reflect positive impact of recent agri deal

Singapore: Noble Group credit rating downgraded to junk by Moody’s as commodity rout deepens

(Bloomberg)

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.