Noble emerges from accounting cloud and signs oversubscribed US$1.1bn RCF

News | 26 October 2015


Asian commodies trade confidence has been underlined by  Noble Group's announcement of its US$1.1bn revolving credit facility.

Announced on 19 October 2015, the deal was oversubscribed and upside from an initial US$450m by a factor of almost three.

The Singapore-listed commodities trader has had to grapple with allegations from Iceberg Research surrounding its controversial mark-to-market accounting practices, which allows a firm to project future profits onto the balance sheet. 

According to a statement on the Noble Group website, this latestwas supported by six main banks led by Bank of Tokyo-Mitsubishi UFJ Ltd. and Societe Generale SA as joint lead arrangers and joint bookrunners.

Such confidence from lenders is doubtless welcome to the trader, whose share price had halved following the publication of the Iceberg Research blog in February 2015.

In a statement on 21 October, Noble Group confirmed that it was focussing on crude and distillates trading, that oil trading revenues were up 30% on the previous year and that it was looking for storage options in China, Singapore and Malaysia.

It had also completed a deal with state-owned PetroEcuador, providing a US$1bn loan which it then repackaged and sold to institutional investors. As a result, Noble will be supplying 30% to 50% of the naptha and diesel imported by PetroEcuador for five years. Besides the five-year supply contract, Noble has also been awarded spot contracts to supply 400,000/bbl of jet fuel and 7.3 million bbl of high-speed diesel (HSD).

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