Noble flags $5bn loss

Bloomberg

Noble Group Ltd., the commodity trader battling to survive, warned that it’ll report another vast loss including from the operations meant to sustain a revamped business, and while it signalled progress in debt-restructuring talks, hurdles to a deal remain.
The Hong Kong-based company will report a net loss of $1.73 billion to $1.93 billion for the final quarter of 2017, potentially bringing losses for 2017 to almost $5 billion, it said. That meant it had a negative net-asset position of $650 million to $850 million at December 31.
Noble Group announced an initial deal to restructure $3.5 billion in debt last month, fending off bankruptcy after a three-year crisis marked by losses, writedowns and controversial accounting. Since that debt-for-equity plan was unveiled, the proposal has drawn fire from a top shareholder as well as some bondholders. With the company now entering a critical phase of negotiations with creditors to nail down the rescue, it said talks are productive and signaled that more than half its senior creditors may be willing to endorse the deal.
The expected fourth-quarter loss “results in a negative net-asset position,” it said. “However, the board believes that the proposed restructuring, once implemented, should restore shareholders’ equity and create a sustainable capital structure which will allow the group to rebuild its business in Asia.”
As part of the proposed deal, Noble Group has reached an in-principle agreement with an ad hoc creditors’ group and ING Groep NV, as a fronting bank, for a three-year $700 million finance facility, it said. That’s to be made available when the restructuring is effective.
The 2022 notes gained
0.2 cent to 49 cents on the dollar by 5:16 pm in Singapore, according to Bloomberg-compiled prices. In the past two weeks, the bonds lost almost 2 cents amid opposition to the debt plan by some investors. The shares closed just 0.5 percent higher after rising 7.1 percent.