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Noble Group Eyes Strategic Investor

By Coco Feng

(Beijing) — Singapore-listed trading house Noble Group Ltd. said it is in talks to get a possible strategic investment, following a media report that it was in early-stage talks to sell a stake in itself to Chinese petrochemical giant Sinochem Corp.

“The board wishes to advise that Noble Group is currently engaged in discussions regarding a possible strategic investment,” Noble said in the statement to the Singapore stock exchange on Tuesday. “However, no binding arrangements have as yet been entered into with respect to this possible transaction and, accordingly, there can be no assurance that this transaction will be concluded.”

Noble issued the statement after Reuters reported on Monday that early-stage talks were occurring between the two sides on a possible strategic investment. Noble didn’t confirm any additional details of the discussions, including the names of potential investors and the size of any cash injections.

Sinochem declined to comment on the matter.

Noble has lost money since 2015, including a $28 million loss in the third quarter of 2016, and has a relatively large debt of $3.42 billion. It has blamed its recent poor results on its “conservative approach to liquidity management,” and has also been hit by weaknesses in global commodities markets.

Ratings firm Moody’s downgraded Noble several times in 2016, marking the outlook for a company that was once Asia’s largest commodities trading house as “negative.”

Noble brought in Chinese capital as early as 2009 when sovereign fund China Investment Corp. (CIC) bought 14.9% of its shares for $850 million. CIC later sold some of that stake in 2014.

A Sinochem investment would follow another much-larger deal by Chinese chemical major China National Chemical Corp., or ChemChina, which is in the midst of a $43 billion takeover of Swiss agriculture giant Syngenta AG.

Contact reporter Coco Feng (renkefeng@caixin.com)

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