By Manju Dalal and Saurabh Chaturvedi
Deutsche Bank said Saturday that it is acting on its own to buy bonds of Noble Group Ltd., days before a crucial shareholder vote on a $3.5 billion restructuring of the Singapore-listed commodity trader.
The confirmation comes a day after The Wall Street Journal r eported the bank's unexpected offer to buy the bonds. It wasn't clear on Friday if Deutsche Bank was acting on behalf of another company or for itself, as banks typically handle bond tenders like this for clients.
The offer comes as Noble has been pursuing a restructuring for months as it seeks to stay afloat, address a liquidity crunch and provide a return to shareholders who have watched Noble's market value decline to about $110 million from a peak of more than $11 billion in 2011 partially on declines in commodities prices.
"Deutsche Bank expects the tender process to increase the already high level of support for the restructuring, as any bonds acquired by the bank will be automatically committed to the restructuring," said Sarah Stabler, vice president, communications at Deutsche Bank in Singapore.
Noble Group declined to comment.
Noble had already secured the support of 86% of creditors, much higher than the minimum 75% it needed for the restructuring. The company needs more than half of equity shareholders to approve the revamp at a meeting on Aug. 27.
Any response to the Deutsche Bank's offer would add more supporters to the restructuring plan, also benefiting the bank as the lender will gain a higher share in the restructured entity with its higher bondholding being acquired at much lower costs.
Deutsche Bank's notice to Noble's bondholders sent on Wednesday gives them time until Aug. 24 to tender their bonds.
The bank's offer covers roughly two-thirds of the debt under restructuring, or $2.34 billion of three separate bonds issued by Noble that are due in 2018, 2020 and 2022. The minimum purchase price is 45 cents on the dollar, according to the notice, which was reviewed by The Journal. These bonds recently traded between 46 and 48 cents on the dollar, according to Thomson Reuters.
Write to Manju Dalal at firstname.lastname@example.org and Saurabh Chaturvedi at Saurabh.Chaturvedi@wsj.com
(END) Dow Jones Newswires
August 18, 2018 10:06 ET (14:06 GMT)
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