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Hot stock: Noble surges and leads the actives as takeover rumours swirl

Friday, March 20, 2015 - 15:43

THE share price of Noble Group surged on Friday after a Reuters report said the commodities company may be a potential takeover target following a recent slump in its market value.

At 3:22 pm, Noble was trading around S$0.91 a share, up six cents, or 7.06 per cent. A staggering 56 million shares changed hands, making it the most actively traded stock on the Singapore Exchange.

Noble's market value has shrunk by US$1.8 billion since Iceberg Research accused it in mid-February of inflating asset values by billions of dollars through aggressive accounting. The company has rejected the claim and linked Iceberg to an employee it fired in 2013.

Earlier, Reuters reported Chinese and Japanese companies have held informal talks with investment banks about approaching Noble. But there were no active discussions between Noble and potential suitors and it was unclear whether any interested parties would actually proceed with a proposal.

Noble did not comment on the report but when contacted by The Business Times, a Noble spokesman said the company's "entire focus has been, and will remain, on ensuring that we run our day-to-day business as efficiently as possible to ensure the execution of the strategic initiatives which underpin our long term growth".

The latest rally was also underpinned by recent purchases by fund houses to raise their stakes in the commodities group.

Insurance giant Prudential said in a Singapore Exchange filing on Thursday evening that its fund management unit Eastspring Investments had pumped another S$4.1 million into the stock. Eastspring bought about 4.4 million shares at 92.1 Singapore cents apiece, bringing its shareholding up to 338.2 million or 5.02 per cent - just above the 5 per cent reporting threshold.

On Wednesday, investment firm Invesco said it had bought 17 million shares at 92.95 Singapore cents each, boosting its stake in Noble to 5.21 per cent.