Noble Group says reaches in-principle deal for debt restructuring

SINGAPORE (Reuters) - Noble Group Ltd said on Monday that it had reached an in-principle agreement with a group of senior creditors for a restructuring of its debt as the struggling commodities trader battles for survival.

The in-principle agreement was reached with an ad hoc group of creditors representing about 30 percent of its senior debt instruments, and will reduce Noble's existing senior debt instruments to $1.7 billion from $3.4 billion, the company said in a statement.

The agreement proposes a debt-to-equity swap, which along with the issuance of equity to retain and incentivise the management team, is expected to result in dilution of existing shareholders' interest in the group, Noble said.

Existing shareholders will hold 10 percent of the ordinary share capital in the company once the proposed restructuring is completed, the company said.

The proposed restructuring includes a three-year committed trade finance and hedging facility of up to $700 million for the company's commodities trading businesses, it said.

"The proposed financial restructuring provides the Group with a sustainable capital structure to deliver long-term value for all of its stakeholders, as the group focuses on its hard commodities, freight and LNG businesses," Noble said.

Noble was once a global commodity trader with ambitions to rival the likes of Glencore and Vitol. Now it has shrunk to its Asian roots as a hard commodities player after a crisis-wracked three years forced it to slash jobs and sell its key assets - some at losses - to cut debt.

Founder Richard Elman is the company's biggest shareholder with a stake of just over 18 percent. Other large investors include sovereign wealth fund China Investment Corp, Orbis Investment Management and Eastspring Investments.

(Reporting by Aradhana Aravindan; Editing by Gopakumar Warrier and Tom Hogue)