Commodity trader Noble Group yesterday said its indirect wholly owned subsidiary Maylion has acquired an additional 52.5 per cent shareholding interest in coal exploration and development firm East Energy Resources (EER).
EER is incorporated in Australia and listed on the Australian Securities Exchange (ASX).
Following the transaction, Maylion's stake in EER will rise to 93.4 per cent from 40.9 per cent. EER will cease to be an associated company of Noble, and become its subsidiary instead.
The additional shares were issued in satisfaction of a A$28 million (S$28.3 million) debt owed to Noble by EER, which has been fully impaired since the third quarter of last year, Noble said.
On this basis, the consideration paid by Noble for this transaction was effectively nil.
Based on the latest unaudited financial statements of Noble for the three months ended March 31, the book value and net tangible asset value attributed to the additional shares were also negligible, Noble said.
EER's market cap stands at about A$1.78 million, based on the number of issued shares in the capital of the firm prior to this deal, and the volume-weighted average price of 0.5 Australian cent, as transacted on June 21, on the ASX.
Noble shares closed at 17.5 cents yesterday, up 24 per cent. Some 91.3 million shares changed hands, making it one of the most heavily traded counters.