New | CIC cuts stake in Noble Group

China Investment Corp sold part of its stake in Noble Group, sending shares in the commodity trader tumbling and sparking fears the mainland sovereign wealth fund will eventually move to offload most of its holding.

CIC, the second-biggest shareholder, sold shares equivalent to 4.5 per cent of the commodity trader.

The shares were sold at S$1.32 (HK$8.04), the bottom of an indicative range that topped out at S$1.35, raising S$396 million.

It was not clear why CIC was selling the stake, but Nathan Gee, an analyst at Bank of America Merrill Lynch, said he did not expect any damage to Noble's strategic relationships on the mainland.

The deal coincided with the completion of Noble's US$1.5 billion sale of a 51 per cent stake in its agricultural products venture to Cofco, the mainland's largest grain trader, and that was the more important relationship, Gee wrote in a report.

But he said investors would be concerned about whether CIC would move to dispose of the rest of its stake, which now is about 9.4 per cent.