S&P down­grades No­ble, sees risk of de­fault

New Straits Times - - Business - S&P GLOBAL RAT­INGS

SIN­GA­PORE: No­ble Group Ltd’s cri­sis deep­ened af­ter S&P Global Rat­ings flagged a risk of de­fault for the com­mod­ity trader within a year, trig­ger­ing a rout in the com­pany’s al­ready-bat­tered shares, an ex­change query, and a trad­ing halt be­fore an an­nounce­ment. Its 2020 bonds plunged to a record.

There’s po­ten­tial the com­pany would face non-pay­ment of obli­ga­tions over the next 12 months, said S&P in a state­ment late on Mon­day as it cut No­ble’s rat­ings by three steps to “CCC+”.

Yes­ter­day, the shares plunged as much as 32 per cent to S$0.40 (RM1.24) and were at S$0.42 as the halt kicked in af­ter just 36 min­utes of trade. The 2020 bonds sank to S$0.397 on the US dol­lar.

The Hong Kong-based trader’s trou­bles are deep­en­ing af­ter two tur­bu­lent years that have been marked by losses, as­set sales and ac­cu­sa­tions of im­proper ac­count­ing that it has de­nied.

Since sur­pris­ing in­vestors two weeks ago with a quar­terly loss, the shares have tum­bled to mul­ti­year lows and the price of its bonds has fallen by more than half. S&P’s warn­ing fol­lows down­grades from Moody’s In­vestors Ser­vice and Fitch Rat­ings Ltd re­cently.

“We down­graded No­ble be­cause we be­lieve the com­pany’s cap­i­tal struc­ture is not sus­tain­able,” said S&P.

The “re­fi­nanc­ing of its large up­com­ing ma­tu­ri­ties will de­pend on the will­ing­ness of its lenders and counter-par­ties”, it said. Bloomberg

We down­graded No­ble be­cause we be­lieve the com­pany’s cap­i­tal struc­ture is not sus­tain­able.

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