China Investment Corporation (CIC), China's sovereign wealth fund, is in negotiation with Noble Group, a Hong Kong-based commodities trader, to acquire shares of the latter, said sources with CIC on Tuesday.
"The deal is still waiting for permission from the boards of directors of Noble Group," said a person with CIC who refused to be identified.
According to a statement released by the Noble Group, the company has reached an agreement with CIC for the Chinese firm to buy 573 million shares for approximately 850 million U.S. dollars, at 2.1137 Singapore dollars per share.
The placement comprised of 438 million newly issued shares by the Noble Group and 135 million shares from trust companies associated with the interests of Noble founder and CEO Richard Elman, according to the statement.
The placement is subject to approvals of the respective boards of directors of CIC and the Noble Group, said the statement.
According to the Noble Group, both companies have agreed to jointly invest in infrastructure assets and supply chain management related to agricultural commodities.
Merrill Lynch (Singapore) Pte. Limited acted as the sole placement agent for Noble Group. J.P. Morgan Securities (Asia Pacific) Limited acted as financial advisor to CIC.
Listed in Singapore, Noble Group is a market leader in managing the global supply chain of agricultural, industrial and energy products.
The CIC was launched in September 2007 with registered capital of 200 billion U.S. dollars from China's huge foreign exchange reserves.
(Xinhua News Agency September 22, 2009)