Noble Group sells US en­ergy busi­ness

The Myanmar Times - - International Business -

BE­LEA­GUERED Asian com­modi­ties trader Noble Group has agreed to sell its North Amer­i­can en­ergy busi­ness to US power gen­er­a­tor Calpine Corp for US$1.05 bil­lion.

The Sin­ga­pore-listed firm said the sale brings it closer to com­plet­ing an ini­tia­tive to raise $2 bil­lion in cap­i­tal as it strength­ens its fi­nances to turn the com­pany around.

The Hong Kong-based com­pany, which has strong links to China, is try­ing to re­store in­vestor con­fi­dence after a plunge in com­modi­ties prices last year ham­mered shares and led to a credit rat­ings down­grade.

It had also faced al­le­ga­tions by lit­tle-known Iceberg Re­search of ir­reg­u­lar ac­count­ing prac­tices.

In a state­ment to the Sin­ga­pore Ex­change, Noble Group said it sold its Noble Amer­i­cas En­ergy So­lu­tions (NAES) sub­sidiary to Calpine for $800 mil­lion, plus $248 mil­lion as re­pay­ment for the US unit’s work­ing cap­i­tal.

“The sale of NAES sub­stan­tially com­pletes the $2 bil­lion cap­i­tal-rais­ing ini­tia­tive that we an­nounced in June,” co-chief ex­ec­u­tives Jeff Frase and Will Ran­dall said.

“With this di­vesti­ture, Noble will con­tinue to re­duce debt while also fund­ing growth op­por­tu­ni­ties in our high-re­turn busi­nesses.”

CMC Markets Sin­ga­pore an­a­lyst Mar­garet Yang said that the sale “largely al­le­vi­ated the con­cerns of a liq­uid­ity squeeze that the com­pany has faced dur­ing [the] com­modi­ties slump, and may aid in Noble Group’s turn­around”. –

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