* Noble had flagged sale; part of strategy to raise funds
* Sale seen reducing market concerns about liquidity
* Noble shares rise 7 pct in early trade
(Adds market reaction, comment, restructuring details)
By Anshuman Daga
SINGAPORE, Oct 10 Singapore-listed commodities
trader Noble Group agreed to sell its North American
energy distribution unit to U.S. firm Calpine Corp for
$1.05 billion, moving a step closer to completing a
restructuring to raise $2 billion to help cut debt.
The sale of Noble Americas Energy Solutions (NAES) includes
repayment of working capital of about $248 million, Noble said
in a statement. Noble's shares rose nearly 7 percent in early
trading on Monday.
The move comes as the Hong Kong-based trader aims to rebuild
investor confidence after a brutal commodities downturn
coincided with a questioning of its accounts in early 2015 by
Iceberg Research, sparking a collapse in its share price and
ratings credit agency downgrades.
"The sale will reduce investors' concerns about Noble's
liquidity and balance sheet," said Nirgunan Tiruchelvam, analyst
at Religare Capital Markets. He said the company's strategy of
getting out of asset-heavy businesses rather than chase
"overpriced assets" was a positive as it would help it focus on
its core operations.
Noble said it expects the NAES transaction to close in
December 2016. Noble's net debt rose to $3.92 billion in
April-June from $3.69 billion a year ago.
"The sale of NAES substantially completes the $2 billion
capital raising initiative that we announced in June", Nobles'
Co-Chief Executive Officers Jeff Frase and Will Randall said in
its statement. "With this divestiture, Noble will continue to
reduce debt while also funding growth opportunities in our
Completing a plan to cut debt could help restore stability
at Noble after many months of turbulence.
Noble's former CEO Yusuf Alireza, a former Goldman Sachs
Asia co-head, quit unexpectedly in late May after helping Noble
secure $3 billion in credit facilities and within days, the
company announced a $500 million cash call.
The firm's founder and chairman Richard Elman also said in
June he would step down within 12 months. Elman grew Noble into
one of the world's biggest traders of commodities in a bull run
since setting up the group in 1986.
Meanwhile, Calpine, which generates electricity from natural
gas and geothermal resources, said in a statement the NAES
purchase price was $800 million plus an estimated $100 million
of net working capital.
(Additional reporting by Shashwat Pradhan in Bengaluru; Editing
by Kenneth Maxwell)