The share price of Noble Group tanked almost 50% today upon news of its strategic review.

 

Noble Group announced that it will continue to focus on debt reduction by selling its Global Oil Liquids and North American Gas & Power businesses. Net proceeds from the sales, along with proceeds from a new asset disposal programme comprising certain of the group’s assets located outside North America, will generate significant cash proceeds to allow the Group to retire 2 of its secured borrowing base revolving credit facilities, as well as reducing the group’s remaining debts. The commodities trading group also issued a loss warning for 2Q17.

As quoted by The Business Times:

Noble has signed a binding stock purchase agreement to sell its wholly-owned unit, Noble Americas Gas & Power Corp, to Mercuria Energy America for US$248 million. The sale is expected to close before the end of 2017.

The group also said it is expected to report a loss in the second quarter of 2017, due to the challenging operating environment along with conservative liquidity management, scaling back of risk positions and constraints placed on the group’s access to trade finance lines, leading to disruption costs and preventing the group from taking advantage of profitable trading opportunities.

Noble Group has been in the limelight recently with a mixture of positive and negative news that caused its share price to swing wildly. If you have missed out on what happened, here is a quick recap of some of the recent news that caused the wild swings in the share price of Noble Group:

24 February – Iceberg Research published an article titled: “NOBLE GROUP: HOW MANY TIMES CAN YOU FOOL THE SAME PEOPLE? Noble Group’s share price tanked 18% after.

10 May  – Noble Group warned that it is likely to report a net loss of US$130 million for its first quarter, share price down 25%.

19 June – Creditors of Noble Group agreed to extend credit facility deadline until October, and in exchange Noble was asked to find a strategic investor, share price up 40%.

6 July – Acquired additional 50% stake in Tailai Coal (Shanghai) Company Limited funded from internal resources, share price up 30%.

Meanwhile, find out how Noble Group’s stock price is doing right now and also see what other investors are saying.

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