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Noble Group trading grinds to a halt amid rumoured deal with Vitol

Reports suggest Noble could have agreed a $1bn deal to offload its oil trading business to Vitol - © Oskar Wintertidh / Alamy Stock Photo
Reports suggest Noble could have agreed a $1bn deal to offload its oil trading business to Vitol - © Oskar Wintertidh / Alamy Stock Photo

Troubled commodities trader Noble Group pulled its share from the Singapore market on Friday amid speculation that Vitol may be poised to snap up its global oil liquids business in a $1bn (£760m) swoop.

The eleventh hour deal is sorely needed by the struggling trader which faces looming debt repayments by the end of this week which could plunge the company into financial ruin unless Noble can sell off assets to meet its repayments.

Noble halted trading of its shares, which have tumbled almost 75pc this year, ahead of an undisclosed “major transaction”, which reports suggest could be a $1bn deal to offload its oil trading business to Vitol, the largest independent oil trading house in the world.

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According to the Reuters news agency the deal may be announced as soon as Monday.

Earlier in the week Vitol boss said his company has “been talking” with Noble to buy the unit but added that the talks are “very complicated”.

Noble was plunged into crisis in the wake of the oil market downturn which crushed earnings for the group leading to a shock loss of $1.75bn within the first quarter of this financial year alone.

The company has already warned of the risk of bankruptcy at two of its major subsidiaries in accounts filed in recent weeks in the UK and Singapore.

In a bid to save the group Noble’s management has aggressively sold off trading portfolios and cut staff numbers to stem the hemorrhaging of its balance sheet.

Noble, which ships raw materials such as oil, gas, metals and minerals to high-growth markets in Asia and the Middle East, sold its US gas and power business to its rival, Swiss trading house Mercuria, for $248m. It also cut its staff from 800 to 400.

Should the oil unit be sold, Noble Group will be left with a largely Asian portfolio, including marketing rights to Indonesian coal, LNG trading, and stakes in Australian and Mongolian coal mines. It also has an alumina refinery in Jamaica.

Among the oil unit’s businesses is a contract for shipping via the Colonial pipeline, the biggest conduit for moving fuel from the US refining centres of Texas and Louisiana to high-demand East Coast markets.

Neither Noble or Vitol commented on the deal speculation.