Singapore-Listed Noble Takes Legal Action Over "Inaccurate" Allegations of Irregularities

Noble has rejected the allegations as "inaccurate, unreliable and misleading."

Asia's largest commodities trader by sales, Noble Group Ltd. (Noble), Monday hit back at reports by Iceberg Research (Iceberg) who has released a number of reports alleging accounting and governance irregularities that have been attributed to a significant decline in Noble's share price.

At the weekend Iceberg released a third report that also alleges links to the November collapse of OW Bunker.

Legal proceedings at the Hong Kong High Court were said to be due to start Monday against a number of parties including a Seychelles company, Enlighten Ace Ltd.

"We reject their allegations as inaccurate, unreliable and misleading", Noble said in a statement to the Singapore Exchange (SGX), where the group's shares are listed.

"Their actions, and their timing, have been calculated primarily to inflict damage rather than to facilitate the distribution of research."

Three reports have been issued by Iceberg, a little known equity research provider, between February 17 and March 21 pointing to alleged misrepresentations by the group of asset values, debt, and liquidity positions, among other things.

"As a public company we support responsible research," said Noble.

"However, Iceberg are not the independent research house they claim to be."

Noble's share price fell from a three-month high of S$1.205 ($0.88), just prior the the release of Iceberg's first report, to a three-month low of S$0.85 ($0.62) on Thursday, wiping significant value from the company's market capitalisation.

Stock Slump is Flushing Out Buyers

The shares have bounced back somewhat since Thursday's lows, recovering 6.5 percent to S$0.905 ($0.66) at Tuesday's close.

Separate reports have suggested that the reduction in Noble's share price have made the company a target for Chinese and Japanese firms looking to gain firmer pricing power in the commodities market.

"The stock slump is flushing out buyers," said one banking source.

"Noble has been very focused on staying independent, but it's hard to see it staying that way now after the price fall and accounting issues."

China's Shanghai Futures Exchange recently said the Chinese Government should offer tax incentives to foreign participants as the country opens up some commodities derivatives trading to outsiders in a move said to be aimed at gaining a stronger say in global commodities prices.