SGX RegCo pushes Noble to hire financial advisor

The advisor will look into shareholding structure concerns in Noble’s debt restructuring plan.

The Singapore Exchange Regulation (SGX RegCo) required Noble Group Limited (NGL) to appoint an independent financial advisor (IFA) that will look into some concerns about the company’s debt restructuring plan.

SGX RegCo said, “The exchange noted the significant change in shareholding structure arising from the proposed restructuring on 5 February 2018. Noble clarified that its senior creditors viewed the company as an important factor in a ‘turn around over the medium to long-term’ and has agreed to the current management Topco structure as a retention plan.”

Under the proposed restructuring, Asset Co Assets and Core Businesses would be transferred to Topco, SGX RegCo noted. On the date of restructuring, existing shareholders will have a 10% interest in Topco. Noble will also have a 10% in Topco, with an additional 10% to be purchased from the senior creditors to vest upon the meeting of certain performance targets. Meanwhile, senior creditors will have a 70% interest in Topco.

On 29 January 2018, the company announced a principle agreement with an ad hoc group of Noble’s senior creditors for a restructuring of Noble’s existing debts. The commodities trader has also been hit by several suspicions and criticisms from shareholders and market watchers alike.

SGX Regco noted that there has been some commentary in the media that the proposed restructuring is complex and the company’s acknowledgement in its earnings call for full-year financial results of the scale and complexity of the restructuring. “Whilst the exchange is cognisant that the company has been in regular discussions with SIAS, it is important that shareholders are given adequate information to make an informed decision when the proposed restructuring is put forth for their vote,” it said.

“The exchange requires Noble to appoint an independent financial advisor (IFA) with relevant expertise which is acceptable to the exchange, to provide an opinion on whether the proposed restructuring, and its results and allocation of shares in the Topco to the shareholders, management, and senior creditors, are fair and reasonable and not prejudicial the interests of shareholders,” it added.

The regulator also required the IFA opinion’s to be included in the shareholders circular “to assure that the shareholders are fully informed in making their decisions with respect to the proposed restructuring,” it added.