Noble Group sells US energy unit to Calpine for US$1.05b

[SINGAPORE] Noble Group has agreed to sell a US energy unit to Calpine Corp as the commodity trader that's backed by China's sovereign-wealth fund seeks to raise cash and boost liquidity.

The company will receive US$1.05 billion for Noble Americas Energy Solutions, or NAES, comprising US$800 million plus the repayment of working capital of US$248 million, Hong Kong-based Noble Group said in an exchange filing in Singapore on Monday. Noble Group will also receive operating cash flows from NAES until the transaction closes, it said.

The sale may aid Noble Group's quest for a turnaround after the company has been mauled by the rout in commodity prices, mounting losses and a liquidity squeeze.

Chairman Richard Elman told Bloomberg News last month the company is on track to raise US$2 billion by cutting jobs and selling assets, including NAES, which was once considered core under former Chief Executive Officer Yusuf Alireza. Elman also said he's still seeking a strategic investor.

"The sale of NAES substantially completes the US$2 billion capital-raising initiative that we announced in June," co-CEOs Jeff Frase and Will Randall said in the statement. "With the divestiture, Noble will continue to reduce debt, while also funding growth opportunities in our high-return businesses."

BLOOMBERG