Anonymous researcher Iceberg Research made a fresh attack on embattled commodities trader Noble Group, saying that the company's bid to restructure its obligations won't lead to a turnaround.
"We fail to understand how a company led by incompetent management that has burnt $1.9 billion in 3 years, recorded trading losses due to bad risk management, and paid itself sky-high salaries, etc. would be able to turn this business around," Iceberg said in an open letter to the creditors of the company on Tuesday.
"The problem with this company is not only that assets have been wildly overvalued. Some liabilities have probably been drastically undervalued."
Iceberg Research, which doesn't identify its analysts, has been sparring with the Hong Kong-based company for more than two years.
The company rejected the claims, saying they're the work of a disgruntled ex-employee it had fired.
Singapore-listed Noble Group, which commenced its strategic review earlier this year, has been forced to shrink its business, exiting loss-making and non-core operations in order to survive.
The company has taken massive writedowns and sold assets at a loss to raise funds amid a liquidity squeeze, while at the same time attempting to get creditors to agree to restructuring $3.5 billion in bonds and loans.
"This restructuring will not address any of the fundamental weaknesses that led to Noble's collapse...The company will continue to burn cash or generate minimum operating cash flow," claims Iceberg.
In its letter, Iceberg urged creditors to seek to have Noble Group's senior managers replaced. The researcher also highlighted the need for the top management to disclose their remuneration.
"Noble needs new senior managers, ideally coming from another commodity trading house. They will bring competent traders with them, with an old-fashioned mentality: a trader is paid to make money and responsibly manage risk."
