Noble Group intends to complete restructuring even after regulators block its relisting

Two weeks ago, the authorities said they were investigating Noble Group for suspected false and misleading statements, and breaches of disclosure requirements.
Two weeks ago, the authorities said they were investigating Noble Group for suspected false and misleading statements, and breaches of disclosure requirements.PHOTO: REUTERS

SINGAPORE - Commodity trader Noble Group intends to press on with its restructuring, and may do so through court-appointed administration in Britain, it said in a statement on Friday (Dec 7).

In a filing to the Singapore Exchange, Noble disputed Singapore regulators' allegations of improper accounting, and added that it intends to submit a "comprehensive response" to assessments and questions by the Accounting and Corporate Regulatory Authority (Acra).

This comes a day after the authorities here refused to allow the embattled company to transfer its listing status to New Noble as part of proposed restructuring plans, citing potentially inflated assets.

Two weeks ago, the authorities said they were investigating Noble Group for suspected false and misleading statements, and breaches of disclosure requirements.

On Friday, Noble said it plans to complete its restructuring to "preserve value for all stakeholders", but in a way that does not involve the transfer of the company's listing status.

"In doing so, the board, in discharging its fiduciary duties, may implement the restructuring through a court-appointed officer," the company added.

While the Monetary Authority of Singapore, Commercial Affairs Department and Acra started investigations on Noble Resources International (NRI) on Nov 20, Noble stressed that there are no investigations on specific individuals at the moment, and that the probe centres on "technical accounting-related issues raised by Acra".

Noble added that the accounting issues raised are "not conclusive".

 
 

"It is premature to conclude that any charges will be issued by the investigating regulators arising from the investigations," it said.

While regulators had earlier referred to simulated financial statements in suggesting that there are significant uncertainties about New Noble's financial position, Noble said these simulations were intended only to illustrate the effects of applying Acra's accounting positions.

The net asset value of New Noble as at Dec 31 last year could be adjusted down by around 40 per cent, but Noble flagged that these simulations also showed that applying the Acra positions would decrease the net loss of New Noble as at Dec 31 2017 by around 45 per cent.

It also disputed various points in Acra's letter to it last month.

Among other matters, it maintained that it has a "strong technical basis for fair value accounting" although Acra challenged the group's derivative treatment for variable marketing contracts.

"The board regrets that after almost 19 months of engagement with its stakeholders, including shareholders, creditors and regulators, it has been informed that MAS and Singapore Exchange Regulation have decided not to allow the company to transfer its listing status," it said.

Noble had previously announced that its US$3.5 billion (S$4.8 billion) debt restructuring had received approval from courts in England and Bermuda.

It also suspended its shares from trading, and had initially aimed to relist on Nov 27.