SINGAPORE (BLOOMBERG) - Noble Group Ltd. arranged two credit facilities totaling US$3 billion (S$4.1 billion), clearing a hurdle in efforts led by Chief Executive Officer Yusuf Alireza to turn around the junk-rated commodity trader.
The facilities comprise a US$1 billion unsecured loan that's supported by 25 banks, and a US$2 billion revolving borrowing-base facility, or BBF, the company said in a statement on Thursday. The Hong Kong-based trader, which reported quarterly earnings on Thursday, didn't disclose the cost and terms.
Noble said first-quarter profit fell 62 per cent with net income in the three months ended March coming in at US$40 million, compared with US$107 million a year ago. Revenue declined 32 per cent to US$11.4 billion from US$16.6 billion.
Noble Group's fresh financing follows cuts in its credit rating to junk by Moody's Investors Service Inc. and S&P Global Ratings amid a rout in raw-materials prices. Fitch Ratings Ltd. has placed the company on negative watch.
The US$2 billion BBF facility will be used by Noble Americas Corp., Noble Petro Inc. and Noble Americas Gas & Power Corp. to fund U.S. business requirements, according to the company statement.
"The BBF allows for the issuance of trade-finance instruments, such as letters of credit, as well as for loans," Noble Group said. "The transaction is supported by a group of core banks led by Bank of Tokyo-Mitsubishi UFJ Ltd. and Societe Generale as joint lead arrangers and joint bookrunners."