Singapore Court Blocks Noble Group Shareholder Meeting

Posted by Joseph Keefe
Friday, April 27, 2018
Noble has other investor meetings due in next few weeks; but court decision could complicate restructuring process.
A Singapore court blocked commodity trader Noble Group Ltd from holding its annual meeting of shareholders on Monday following legal action sought by dissident shareholder, Goldilocks Investment Co. Ltd.
Friday's ruling is the latest skirmish between Noble and Goldilocks, Noble's third-largest shareholder, in the fight over Noble's restructuring plans with creditors, which will be put forward for shareholder approval a few weeks after the planned annual general meeting (AGM).
Goldilocks sought to halt the AGM after Noble rejected its nominations for five new director to the Singapore-listed trader's board.
"The judge decided that Noble be restrained from proceeding with the AGM currently fixed for April 30," Suresh Nair, a Singapore-based counsel representing Goldilocks, told Reuters.
Abu Dhabi-based Goldilocks, which holds an 8.1 percent stake in Noble, filed lawsuits in Singapore this week, saying Noble is not recognising its "legitimate legal rights" as a shareholder and asked the Singapore High Court to block Monday's meeting.
This week, Noble rejected Goldilocks' nominations that were to be proposed at the AGM, saying the paperwork was not valid.
Noble declined to comment on Friday's ruling. Trading in the company's shares was halted on Friday afternoon pending an announcement from the company.
The Singapore High Court confirmed it had granted the injunction against Noble on "modified terms."
Once Asia's largest commodity trader, Noble market value has plunged to just $88 million, from $6 billion in February 2015. The company has sold billions of dollars of assets, taken hefty writedowns and cut hundreds of jobs over the past three years to slash debt.
CONTROVERSIAL RESTRUCTURING
The legal fight stems from Goldilocks' dispute with Noble over its $3.4 billion debt restructuring plan. Noble has agreed to hand over 70 percent equity stake in its restructured business to senior creditors in return for reducing its debt in half. Existing shareholders will get a 15 percent equity stake in the new company.
Goldilocks, which last month sued Noble and its management, alleging they had inflated its assets, opposes the restructuring plan as protecting creditors at the expense of shareholders.
In a letter this month, Goldilocks said the equity stake given to shareholders "will have little or no value" since the cash flows from the new company will be directed to the portion held by creditors.
Goldilocks has also started legal action to prevent Noble, the company's board and supporting creditors from proceeding with the debt deal.
Noble says the restructuring plan will benefit all stakeholders, and an insolvency is the only alternative if shareholders do not approve its proposal.
Earlier this month, Noble improved the terms of the restructuring and won the support of its biggest shareholder Richard Elman, who also founded the company.

Noble was plunged into crisis in February 2015 when Iceberg Research questioned its books. Noble has stood by its accounting.

Reporting by Anshuman Daga 

Categories: Energy Finance Legal

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