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Noble rejects Goldilocks' nomination of 5 directors, cites use of nominee account

2018-02-26T062720Z_2039803978_RC1F736951E0_RTRMADP_3_NOBLE-GROUP-RESULTS.JPG
Noble Group has rejected substantial shareholder Goldilocks' attempt to nominate five non-executive directors at its upcoming annual general meeting (AGM) on April 30.

NOBLE Group has rejected substantial shareholder Goldilocks' attempt to nominate five non-executive directors at its upcoming annual general meeting (AGM) on April 30.

This was on the basis that Goldilocks, an Abu Dhabi-based investment fund, is not a member of the company because it holds its shares through a depository agent, Noble said in a pre-market open local bourse filing on Monday.

Last week, Goldilocks lodged a notice proposing that Ajit Vijay Joshi, Bachir Nawar, Khoo Song Koon, Chow Wai San, and Lim Yu Neng Paul be put up for election as non-executive directors of Noble.

It also sent a request for the company to circulate a statement to its shareholders about the proposed nominations. The notice and the request were lodged at the company's registered address in Bermuda.

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But Noble said on Monday that Goldilocks' notice and request were not in accordance with the company's by-laws or the Bermuda law.

The company argued that since Goldilocks holds its shares through depository agents - Goldilocks has said that it holds Noble shares through a DBS nominee account with SHUAA Capital as its broker - it is actually The Central Depository (CDP) that is listed as a member of the company, not Goldilocks.

"The notice and request served by Goldilocks has been issued and signed in Goldilocks' name. As Goldilocks is not a registered holder, the board has been advised that as a matter of Bermuda law Goldilocks is not a member," Noble said.

On Monday morning, Goldilocks responded by saying that Noble has "threatened its standing as a shareholder" of the group, and that Noble's reasoning damages the standing of all shareholders.

Singapore's Securities and Futures Act directs that shareholders holding stock through a nominee account should be deemed to be members of the company, Goldilocks said. Given that many of Noble's shareholders use nominee accounts, Noble's position "effectively means that only CDP and the 39 individuals listed on Noble's member register will be entitled to assert and enforce rights as members", Goldilocks argued.

"This is oppressive and coercive," the shareholder said.

Later in the day, the Abu Dhabi-based fund also released a statement urging Noble to, among other things, provide full details of when Noble had sought to engage an independent financial advisor (IFA) and explain why it had failed to announce its engagement of the proposed IFA candidate.

This was made in response to an open letter on April 18 by Noble chairman Paul Brough stating that the board had, independently from the Singapore Exchange, already sought an IFA to opine on whether or not the restructuring plan is fair and reasonable to shareholders.

He also said that the IFA report will be included in the circular to shareholders setting out the proposal.

In the statement rebutting 13 points made by Mr Brough, Goldilocks also said that there is no basis to incentivise management if the restructuring support agreement (RSA) is implemented, as new Noble would only be left with contracts with counterparties in emerging markets such as Indonesia.

"Leaving aside the material risk of an adverse impact to these contracts under the RSA, there is no prospect that existing management will be able to extract value from these contracts," it said. It also requested for Noble to provide full disclosure of all assets in new Noble and how these assets can support debts of up to US$2.355 billion.

Separately, Noble announced on Monday that the long stop date of a proposed disposal by its wholly-owned subsidiary has been extended to May 31.

This is in relation to Noble Resources International's disposal of the marketing and offtake agreement to Tricon Dry Chemicals LLC and the debt contracts to Tricon International.

Noble shares traded at 10.7 Singapore cents as at 3.24pm, up 0.2 cent or 1.9 per cent from Friday's close.

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