Why is Noble lending credibility to Muddy Water's assertion by announcing on 8 Apr its intention to launch a syndicated revolving loan facility of US $2.25bn, and even at that, the arrangements being on an unsecured basis. Surely this new exercise seems to give weight to what MW is suggesting? What is disturbing is the purpose of this new facility is to repay some existing debts, substantiating the contention by MW that the group is unable to generate new cash inflow and is surviving from debt to debt, some sort of robbing Peter to pay Paul Syndrome. Not vested in this counter at the moment and probably would not.
A closer look shows that Block’s once-stellar track record has faltered of late. Since bringing down Sino-Forest Corp. in 2011, a case that burnished his reputation as one of the world’s most successful bears, four of the six companies he’s publicly targeted have rallied, including American Tower Corp., which added about $7.7 billion in market value last year alone.
It doesn't matter whether Noble has weathered the stock chart storm or the effect of market shorting has dissipated. The bigger picture still looms - and that is a lot of unanswered questions and controversy still surrounds the lack of transparency of its accounting details. The shortcomings and "cover-ups" in MW's allegations must be properly addressed by full and transparent disclosure of details to convince unsuspecting investors, whose confidence in the stock rests on nothing but what they perceive to be due diligence as having been conducted by Noble's external auditors. As reported in the press, the MAS is presently looking into MW's report. That certainly raise the tempo a fair bit.
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