Abu Dhabi fund in ‘Noble’ cause

london/singapore — Noble Group, the commodity trader that’s struggling for survival, has a new substantial shareholder after an Abu Dhabi fund built up a five per cent stake over two days. The stock rallied in Singapore.

Goldilocks Investment added 50.5 million shares on June 20, after buying 15.5 million shares the day before, according to a filing to the Singapore Exchange late on Thursday. Goldilocks now has a holding of 5.03 per cent.

The investment comes as Hong Kong-based Noble Group searches for a strategic investor to restore confidence after a collapse in its shares and bonds, and follows an agreement with core banks to extend a key credit facility. Goldilocks is controlled by investor Jassim Alseddiqi’s Abu Dhabi Financial Group, which didn’t respond to requests for comment. It started the $200 million fund last year, saying that it would target undervalued opportunities in the six GCC nations.

“Goldilocks’ involvement, together with the recent extension of Noble’s credit facility, provides some encouragement that it can achieve a meaningful restructure,” Ric Spooner, chief market analyst at CMC Markets in Sydney, said by e-mail. “However, conservative investors are likely to need evidence of a more significant deal on equity partnership or asset sales.”

Noble Group has rallied this week after the company agreed to extend by 120 days the $2 billion credit facility that had been due to mature, paring its slump since the start of the year. On Friday, the stock surged as much as 22 percent to 55.5 Singapore cents, and ended at 53 cents.

At Thursday’s closing price, Goldilocks’s stake was worth about S$30 million ($21.6 million). The fund built its holding in the opening two days of the week, with the stock rallying 46 per cent on Monday, aided by the agreement to extend the credit facility, and a further 6.3 per cent on Tuesday.

Alseddiqi’s Abu Dhabi Financial Group, with assets under management of $5 billion (Dh18.3 billion), has a history of buying stakes in listed firms. In past years, it acquired holdings in Bahrain-based GFH Financial Group, Dubai-based Gulf Navigation Holding and the brokerage arm of Abu Dhabi-based First Gulf Bank. — Bloomberg