Vitol expands coal trading in Noble Resources purchase

Vitol has agreed to buy fellow commodity trading firm Noble Resources for $208.9mn, a deal that will expand its coal trading business.

Vitol will pay the equivalent of $0.63 per share on a cash free and debt free basis for the Singapore-based firm and expects to close the deal before the end of 2024, it said on 2 August.

The reconstituted Noble Resources trades and manage more than 35mn t/yr of thermal coal, sourced from Indonesia and Australia and marketed to key markets across Asia-Pacific. Its predecessor company Noble Group was forced to sell many of its assets because of a debt crisis after accusations of accounting fraud. The company completed a $3.45bn debt restructuring in December 2018. Major divestments included selling its North American oil liquids business to Vitol in 2017 and its North American power and gas unit to trading firm Mercuria.

The acquisition of Noble Resources is the latest in a series of strategic moves by Vitol to expand its global operations. Vitol in June this year completed a deal to buy a controlling stake in Italian refiner Saras. The deal will lift Vitol's investments in refining capacity to over 800,000 b/d and grow its footprint in the Mediterranean. Vitol in April acquired US-based renewable energy company BioMethane Partners to form Vitol BioMethane (VBM). The combined capacity at VBM is estimated to generate an equivalent 22mn cellulosic biofuel D3 renewable identification number credits.

By Janet Ong