<TABLE border=0 cellSpacing=0 cellPadding=0 width=452><TBODY><TR vAlign=top><TD></TD></TR><TR><TD vAlign=top width=452 colSpan=2>Published September 17, 2009
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>Noble in talks on major stake sale
Move comes as investors turn their attention to commodities
By JAMIE LEE
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COMMODITY supplier Noble Group said yesterday it is in detailed discussions with an unidentified investor on the sale of a major stake in the $7.8 billion company.
The move comes as investors turn their attention to commodities, with inflation prompting them to look for possible hedges. Analysts are also touting commodities as a way to ride economic recovery.
'Noble is engaged in detailed negotiations with one of these investors, and these discussions may or may not lead to the purchase of a major shareholding in the group,' the company said in a regulatory filing.
Noble requested a trading halt in its shares so 'no investor segment will be disadvantaged'. It said it is optimistic about the group's trading conditions.
The stock last traded at $2.30 and has more than doubled in value since the start of the year. Like most of its peers in the commodities sector, Noble's stock has outperformed the Straits Times Index.
Noble is OCBC Investment Research's top pick for its diverse product portfolio and valuation. Prior to the trading halt, the stock was trading at 12.7 times forward earnings, Bloomberg data shows. This compares with rival commodity supplier Olam International's 20.8 times.
Noble's profits could swell over the next three to five years on the back of new capacity in sugar, soybeans and possibly natural gas expected to come on stream next year, according to a Bank of America- Merrill Lynch report cited by Reuters.
'We believe Noble could raise capital via debt and equity to fund its natural gas venture,' Reuters quoted the report as saying.
Noble's chief operating officer is said to have met more than 30 investors in Europe this month, the report added.
The announcement by Hong Kong-based Noble comes after it outbid Australian miner Whitehaven Coal for control of Gloucester Coal in May.
Noble raised its cash bid for Sydney-based Gloucester to A$460 million (S$563 million) for the Gloucester shares it did not already own. It now holds 87.7 per cent of Gloucester.
One analyst said this could be part of Noble founder Richard Elman's succession planning. Mr Elman is aged 69.
'It makes sense for the major shareholder to reduce his stake and consider an appropriate succession plan given his age,' Hong Kong-based analyst Annisa Lee, from Nomura International, told Reuters.
Noble's largest shareholder is Noble Temple Trading with a 31 per cent stake. Vice-chairman Harry Banga is the second-largest shareholder with 10.5 per cent.
Noble's second quarter profit more than doubled, thanks to a one-time gain from the acquisition of Gloucester.
Net income rose to US$248.8 million in the three months to June 30, from US$122.5 million a year earlier.
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</TD></TR><TR><TD vAlign=top width=452 colSpan=2>Noble in talks on major stake sale
Move comes as investors turn their attention to commodities
By JAMIE LEE
<TABLE class=storyLinks border=0 cellSpacing=4 cellPadding=1 width=136 align=right><TBODY><TR class=font10><TD width=20 align=right>
</TD><TD>Email this article</TD></TR><TR class=font10><TD width=20 align=right>
</TD><TD>Print article </TD></TR><TR class=font10><TD width=20 align=right>
</TD><TD>Feedback</TD></TR></TBODY></TABLE>COMMODITY supplier Noble Group said yesterday it is in detailed discussions with an unidentified investor on the sale of a major stake in the $7.8 billion company.
The move comes as investors turn their attention to commodities, with inflation prompting them to look for possible hedges. Analysts are also touting commodities as a way to ride economic recovery.
'Noble is engaged in detailed negotiations with one of these investors, and these discussions may or may not lead to the purchase of a major shareholding in the group,' the company said in a regulatory filing.
Noble requested a trading halt in its shares so 'no investor segment will be disadvantaged'. It said it is optimistic about the group's trading conditions.
The stock last traded at $2.30 and has more than doubled in value since the start of the year. Like most of its peers in the commodities sector, Noble's stock has outperformed the Straits Times Index.
Noble is OCBC Investment Research's top pick for its diverse product portfolio and valuation. Prior to the trading halt, the stock was trading at 12.7 times forward earnings, Bloomberg data shows. This compares with rival commodity supplier Olam International's 20.8 times.
Noble's profits could swell over the next three to five years on the back of new capacity in sugar, soybeans and possibly natural gas expected to come on stream next year, according to a Bank of America- Merrill Lynch report cited by Reuters.
'We believe Noble could raise capital via debt and equity to fund its natural gas venture,' Reuters quoted the report as saying.
Noble's chief operating officer is said to have met more than 30 investors in Europe this month, the report added.
The announcement by Hong Kong-based Noble comes after it outbid Australian miner Whitehaven Coal for control of Gloucester Coal in May.
Noble raised its cash bid for Sydney-based Gloucester to A$460 million (S$563 million) for the Gloucester shares it did not already own. It now holds 87.7 per cent of Gloucester.
One analyst said this could be part of Noble founder Richard Elman's succession planning. Mr Elman is aged 69.
'It makes sense for the major shareholder to reduce his stake and consider an appropriate succession plan given his age,' Hong Kong-based analyst Annisa Lee, from Nomura International, told Reuters.
Noble's largest shareholder is Noble Temple Trading with a 31 per cent stake. Vice-chairman Harry Banga is the second-largest shareholder with 10.5 per cent.
Noble's second quarter profit more than doubled, thanks to a one-time gain from the acquisition of Gloucester.
Net income rose to US$248.8 million in the three months to June 30, from US$122.5 million a year earlier.
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