Noble

Noble: (S$0.515) Red flag raised on its credit rating by Moody's
Credit rating agency Moody's has warned Noble that its Baa3 investment grade rating may be downgraded if the commodity group's leverage position does not improve in the next 1-2 quarters.

Just two days back, Noble successfully upsized its senior secured revolving trade credit facility from US$450m to US$1.1b, to support its US energy business.

While the overall debt level for the group is expected to stay stable and drawings under the facility would increase liquidity, Moody's caution that the upsized facility will limit the financial flexibility of Noble and raise the risk of subordination for the company's senior unsecured creditors, which are credit negative.

Noble's ratings could also be downgraded if the company's liquidity position does not improve over the next one to two quarters, or its leverage continues to rise, such that net debt/EBITDA stays at 3.5x-4.0x and retained cash flow/net debt falls below 20% for a prolonged period.