13 February 2017 by lberuti
NOBLSP ( Noble Group Limited ) has been fighting to prop up its finance after a torrid 2015 and 2016, during which its share price collapsed and its 5-year risk premium went through the roof amid attacks on its accounting. Last year, the company sold its 49% stake in Noble Agri Ltd for $750m and raised $500m in June through a capital increase. They managed to stabilise NOBLSP’s equity and send the prices of the bonds up, and that they are in a much stronger position now than a year ago to negotiate a deal with a strategic investor. That certainly gave more weight to rumours alleging that NOBLSP would be in early talks about a partnership with Sinochem Group, the Chinese state owned oil and chemical group which could be interested in gaining access to NOBLSP’s global supply chain and has the ambition to be a more globally active energy trader. The deal is by no means certain, but these brighter prospects convinced investors to send NOBPSP’s 5-year risk premium 280bps tighter at 627bps, a level not seen since mid-2015.
Meanwhile, the broader credit market enjoyed a strong albeit quiet session as part of Europe is hitting the slopes for half term. CDXIG and iTraxx Main were 1bp and 2bps tighter at 63.5bps and 73bps respectively, while CDXHY and iTraxx Crossover were 4bps and 5bps tighter at 320bps and 295bps respectively.