Noble Group

[greengiraffe]

http://www.businesstimes.com.sg/energy-c...to-us1539m

Noble's Q3 profit soars to US$153.9m
Revenue up 7% at US$23.3b as group handles a third more volume

By
Andrea Sohsandrea@sph.com.sgAndreaSohBT
NOBLEGRP96333.jpg NOBLE Group posted third-quarter net profit of US$153.9 million, almost seven times the US$22.9 million a year ago, thanks to increased trading volumes and a turnaround profit on the group's supply chain assets. PHOTO: BLOOMBERG
8 Nov5:50 AM
Singapore

NOBLE Group posted third-quarter net profit of US$153.9 million, almost seven times the US$22.9 million a year ago, thanks to increased trading volumes and a turnaround profit on the group's supply chain assets.

Revenue rose 7 per cent to US$23.3 billion, from US$21.8

[greengiraffe]

Noble still own a stake in Yancoal?

Yancoal launches $US2.3b notes offer to slash debt
PUBLISHED: 0 HOUR 10 MINUTES AGO | UPDATE: 0 HOUR 0 MINUTES AGO

Yancoal launches $US2.3b notes offer to slash debt

Yancoal will issue 2.32112 subordinated capital notes for every 100 Yancoal Australia shares held. Photo: Peter Rae

Chinese-owned coal miner Yancoal, which has a listing in Australia, is trying to raise $US2.3 billion through a subordinated capital notes offer to repay a mounting debt pile owed to its major shareholder.

Yancoal, which has seven mines in Australia, will also be fed up to $1.4 billion by majority shareholder Yanzhou Coal, to prop it up during a dismal time for the coal industry.

Yanzhou has also given an undertaking that it will “ensure Yancoal remains solvent”, for as long as it remains majority shareholder.

The struggling Australian coal sector is immersed in a sea of red ink despite cutting costs for the past two years, and is poorly placed to wear any more cost pressure.

Yanzhou Coal, China’s fourth-biggest coal company, holds a 78 per cent stake in Yancoal, which made its debut on the Australian Securities Exchange in mid-2012.

Yancoal chief Reinhold Schmidt said the decision was taken to reduce gearing and “deliver significant cost savings to weather the challenges of an increasingly competitive marketplace”.

“In a depressed commodities marketplace facing continued uncertainty for the near-term, Yancoal’s existing level of debt is a significant constraint on our future expansion and operational improvement strategies,” Mr Schmidt said.

Under the renounceable rights offer, Yancoal will issue 2.32112 subordinated capital notes for every 100 Yancoal Australia shares held - up to a value of $US2.3 billion. The notes will be treated as equity.

About $US1.8 billion of proceeds will be used to repay existing senior debt from Yanzhou. The balance will be used at Yancoal’s suite of existing coal mines and future growth.

The coal miner also said on Monday that Yanzhou will provide up to $1.4 billion in extra finance, and it will support fund distributions on the subordinated capital notes over a five year period, after they are issued.

If the offer proceeds, Bank of China and China Construction Bank will grant an extension on the repayment of their $US2.6 billion syndicated facility for three years.

The Australian Financial Review

[greengiraffe]

Noble strategic partner of Chinese... but now being forced to sell out at low?

Chinese line up new tilt for Yancoal
THE AUSTRALIAN NOVEMBER 11, 2014 12:00AM

Sarah-Jane Tasker

Reporter
Sydney
Net profit and share price chartsNet profit and share price charts Source: TheAustralian < PrevNext >
••
CHINESE giant Yanzhou could finally succeed in its aim to take full control of its Australian interest, Yancoal, under a $US2.3 billion ($2.65bn) debt deal that looks set to dilute the minority shareholders of the coalminer.

Just under 10 months after Yanzhou abandoned its full takeover bid for Yancoal, the 78 per cent shareholder has agreed to take on $US1.8bn of the subordinated capital note offer — the largest note offer in Australian corporate history — to repay a loan to itself.

Yancoal, Australia’s largest independent coalminer, said the funds raised through the notes would be used to repay existing debt and to fund operations as well as future growth.

As well as committing to subscribe for its full entitlements in the offer, Yanzhou will also provide up to $1.4bn in additional ­financial support.

“There are multiple factors here that drive something like this, but the fundamental issue is working towards preparing our balance sheet, so it gives us the ­capacity to secure funding for our future growth,” Yancoal chief executive Reinhold Schmidt said.

“It demonstrates Yanzhou’s continued commitment to invest in Australia and the local industry ... and make sure we can ride the storm and get through really challenging market conditions.”

The debt issue comes at a time when the coal sector is deeply out of favour among investors, with prices for both thermal and coking coal falling on softer demand from China.

Shares in the company plunged on the announcement, closing 27 per cent lower at 16c. This time last year the share price was sitting around 70c.

The offer is likely to anger 13.8 per cent shareholder Noble Group, which also has a marketing agreement with the miner. The Australian understands that Hong Kong-based Noble was unaware of the offer until it was released to the market yesterday morning.

The commodities trader declined to comment until it saw the full details of the offer.

Under the offer, open to all shareholders, Yancoal will issue 2.32112 subordinated capital notes for every 100 Yancoal shares held. The notes will be treated as equity.

If the minority shareholders shun the offer, Yanzhou could increase its holding to around 89.5 per cent of Yancoal.

Mr Schmidt would not comment on the suggestion that the offer was a backdoor way for the Chinese parent to creep up Yancoal’s share register.

“From an organisation point of view we see this as the best deal possible for us,” he said.

“The independent board committee was tasked to consider many options and this one is the most appropriate at this stage. We are yet to hear back from the minority interests. It’s in the best interest of all our shareholders and I cannot speculate what they will do, they have only seen it, so we need to give them time to consider it.”

Yanzhou had approached Yancoal with an indicative, non-binding takeover proposal in July 2013, but walked away from that in March this year, after Joe Hockey had relaxed foreign investment review board rules linked to previous takeovers by the Chinese company.

Yanzhou had beefed up its Australian interests by effectively spending more than $5.5bn buying Felix Resources in 2009 and Gloucester Coal in 2012 to form Yancoal — one of the biggest publicly listed pure-play coal producers in the country.

With the Chinese giant’s attempt to potentially dilute the minority shareholders out of the company with yesterday’s offer, Mr Schmidt said they were taking a long-term view on the coal market, which had been suffering from tough market conditions.

“We all understand the commodity business is a cyclical one,” he said.

[BlueKelah]

From Yancoal recent quarterly report....
Yancoal Australia Ltd (Yancoal) announced a loss after income tax of $192.7 million from revenue of $654.6 million for the half year ended 30 June 2014. Operating EBIT was a loss of $186.1 million.

Losses were mostly attributable to the impacts of the continuing strength of the Australian dollar and downturn in thermal and metallurgical coal prices, driven by global market oversupply.

Non-current Interest-bearing liabilities
4,987,741,000

Net assets
989,949,000
Source

Wow what would happen if to Yancoal if coal prices continue to plunge on the back of reduced demand from Japan (restarting reactors) and Europe(going Solar) and China? Trying to privatise a company soon going underwater?

Noble should be shopping for a buyer for its shares in Yancoal and quickly cut loss, looks like a sinking ship this Yancoal.

[greengiraffe]

Yanzhou sees Yancoal’s note offer as a route to 100pc control of the Australian miner
THE AUSTRALIAN NOVEMBER 12, 2014 12:00AM

CHINESE giant Yanzhou has asked its shareholders to back its “major transaction” with Yancoal, saying it could end up with a “possible acquisition”.

The Hong Kong-listed company has outlined to its shareholders that, through its agreement to take up $US1.8 billion of Yancoal’s $US2.3bn subordinated capital note offer, it could end up with an almost 100 per cent stake in the Australian company.

“In the case that only the company will subscribe for its full pro rata entitlement of the convertible hybrid bonds and all other Yancoal Australia shareholders do not ... the equity interest held by the company in Yancoal will increase from 78 per cent to 98.8 per cent,” Yanzhou told its shareholders.

“The issue of such new Yancoal shares to the company will therefore constitute an acquisition of equity interest upon conversion of the convertible hybrid bonds to be subscribed by the company.”

Yancoal revealed the $US2.3bn subordinated capital note offer on Monday — the largest note offer in Australian corporate history — to repay debt and fund operations and growth. Under the offer, open to all shareholders, Yancoal will issue 2.32112 subordinated capital notes for every 100 Yancoal shares held. The notes will be treated as equity. Shares in Yancoal sank on the news and declined further yesterday, by 6.25 per cent to 15c.

Hong Kong commodities trader Noble Group has a 13.8 per cent stake in Yancoal and is understood to be annoyed it was kept in the dark about the offer until it was announced to the market.

A prospectus on the offer is not expected for a couple of weeks.

If Noble Group, which also has a marketing agreement with Yancoal, does not take up the offer, it will be diluted to a 0.7 per cent holding in one of Australia’s largest listed pure coal plays. The commodities trader earned its interest in the company when Yancoal took over Gloucester Coal in 2012, which Noble controlled.

Noble is believed to have been trying to get Yanzhou to agree on a deal to buy out the minority shareholders after the Chinese group abandoned its takeover of Yancoal earlier this year.

In July last year, Yanzhou launched a non-binding proposal to mop up the 22 per cent of Yancoal it did not own via a scheme of arrangement, with the view to then privatising the company.

Yancoal chief executive Reinhold Schmidt said this week that its independent board committee was tasked with considering many options and the note offer was the most appropriate at this stage.

[greengiraffe]

Fund in appeal at bid for Yancoal
THE AUSTRALIAN NOVEMBER 25, 2014 12:00AM

Sarah-Jane Tasker

Reporter
Sydney
YANCOAL Australia’s minority shareholder, Senrigan Capital, has referred a debt deal that could give the miner’s Chinese parent full control of the company to the Takeovers Panel.

The panel said yesterday it had received an application from the Hong Kong-based hedge fund and its founder and chief ­investment officer, Nich­olas Taylor.

Earlier this month Yancoal announced a $US2.3 billion ($2.6bn) debt deal that would see 78 per cent shareholder Yanzhou take on $US1.8bn of the subordinated capital note offer.

Under the offer, open to all shareholders, Yancoal will issue 2.32112 subordinated capital notes for every 100 Yancoal shares held. The notes will be treated as equity.

If the minority shareholders shun the offer, Yanzhou could increase its holding to around 98.8 per cent of Yancoal.

Senrigan, which has less than a 0.6 per cent stake in Yancoal, complained that the deal would enable Yanzhou to convert its subordinated capital notes into equity at depressed prices “so as to permit the compulsory acquisition of minorities ­cheaply”.

The hedge fund requested that the offer not go ahead until the conclusion of panel proceedings but it also sought, as an ­alternative, that the rights offer be made subject to shareholder approval.

The Takeovers Panel said a sitting panel had not been appointed at this stage and no decision had been made whether to conduct proceedings.

“The panel makes no comment on the merits of the application,” the panel’s statement said.

A spokesman for Yancoal said he believed that the application had no merit.

“The offer of subordinated capital notes represents the most attractive capital raising option for shareholders as a whole and the overall transaction offers Yancoal a number of other significant benefits.”

Hong Kong commodities trader Noble Group has a 13.8 per cent stake in Yancoal and is understood to not be happy with the offer.

If Noble Group, which also has a marketing agreement with Yancoal, does not take up the offer, it will be diluted to a 0.7 per cent holding in one of Australia’s largest listed pure coal plays.

[specuvestor]

Effectively a structured rights issue/ debt to equity swap to squeeze out minorities who dont want/ cannot fork out more capital... Quite ingenious

[safetyfirst]

business is not easy to do, seems to me like even a significant shareholder such as noble group can be taken advantage

[opmi]

business is not easy to do, seems to me like even a significant shareholder such as noble group can be taken advantage

being OPMI, it is the life to scared here scared there:

too much cash - scared major shareholders do IPTs to cream out the cash.
too much debt - scared major shareholders do massive dilution at the worst time.
too much discount to NAV - scared major shareholders privatised at low ball price.

[specuvestor]

^^ Agree... The hard truth is that this is the nature of minority investing.

If there are no laws or enlightened self-interest in appreciating share price, the incentive would simply for listed companies that doesn't need capital to make management/ directors' expense equals EBITDA

more scary is when OPMI don't realise they are OPMI and try to be catalysts for change, oblivious to the ranks of value investors fallen in value traps