Noble's liquidity crunch likely to ease in 3Q, says Fitch

SINGAPORE (Aug 16): A liquidity crunch at Noble Group may prove to be temporary, according to Fitch Ratings, which said that the Singapore-listed commodity trader will probably generate about US$900 million ($1.2 billion) in the coming months including proceeds from a recent rights issue.

Liquidity will improve as Noble Group gets US$500 million from the rights issue and the rest from working capital reductions, Fitch Ratings said in a statement on Monday. The crunch of the second quarter won't persist and Noble Group will have sufficient liquidity in this quarter, it said.

The Hong Kong-based trader, which is backed by China's sovereign wealth fund, has seen a two-year collapse in its shares as raw materials tanked, its accounting practices came under scrutiny, and ratings agencies including Fitch cut the company's debt to junk.

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