Noble Group attracts Goldilocks as major shareholder as bears prowl

A file picture of Noble Group Ltd. signage on display. PHOTO: BLOOMBERG
A file picture of Noble Group Ltd. signage on display. PHOTO: BLOOMBERG

SINGAPORE (BLOOMBERG) - Noble Group, the commodity trader that's struggling for survival, has a new substantial shareholder after an Abu Dhabi fund built up a 5 per cent stake over two days as the stock surged.

Goldilocks Investment added 50.5 million shares on June 20, after buying 15.5 million shares the day before, according to a filing to the Singapore Exchange late on Thursday (June 22). Goldilocks now has a stake of 5.03 per cent.

Noble stock traded hotly on Friday (June 23) morning, rising to S$0.515.

The investment comes as Hong Kong-based Noble Group searches for a strategic investor to restore confidence after a collapse in its shares and bonds. Goldilocks is controlled by investor Jassim Alseddiqi's Abu Dhabi Financial Group. It started the US$200 million (S$277.9 million) fund last year, saying it would target undervalued opportunities in the six Gulf Cooperation Council countries.

Noble Group's shares have rallied 40 per cent this week as the company agreed to extend by 120 days a US$2 billion credit facility that had been due to mature. Nonetheless, the shares are still down more than 70 per cent in 2017.

At Thursday's closing price of 45.5 Singapore cents, Goldilocks's stake was worth about S$30 million. The stock rallied 46 per cent on Monday, with gains aided by the agreement to extend the credit facility, and rose a further 6.3 percent on Tuesday as Goldilocks built up its holding.

Abu Dhabi Financial Group, with assets under management of US$5 billion, has a history of buying stakes in listed companies. In past years, it acquired holdings in Bahrain-based GFH Financial Group, Dubai-based Gulf Navigation Holding and the brokerage arm of Abu Dhabi-based First Gulf Bank. Abu Dhabi Financial Group did not immediately respond to requests for comment on its move to acquire the Noble Group stake.

Noble Group remains under pressure after several turbulent years marked by losses, credit-rating downgrades, and accusations of improper accounting that it has denied. Led by new chairman Paul Brough, a restructuring specialist, it has hired Morgan Stanley and Moelis & Co to review its options.