China’s state-owned Sinochem is no longer pursuing an investment in Noble Group Ltd due to concerns over the finances and business outlook of the loss-making commodity trader, three sources familiar with the matter told Reuters.

When it held talks with Noble earlier this year to buy a stake, Sinochem’s thinking, sources have told Reuters, was that a deal could help the oil, gas and petrochemicals producer to become a globally active energy trader.

But Sinochem has become cautious about linking up with Noble after the trader posted a shock quarterly loss this month and warned that it would not be profitable for the next two years. This sparked a rout of its shares and bonds and triggering cuts in outlooks by rating agencies.

The Sinochem move, the only large-scale name publicly linked to Noble in recent times, is a setback to the commodity trader. It comes at a time when it is set to negotiate a crucial rollover of a $2 billion credit facility secured on its inventories and working capital.

Noble has been wracked in the past two years by a steep downturn in commodities markets, management overhauls and allegations of improper accounting, which the company has steadfastly rejected.

Sinochem, which has not commented on its interest in a Noble stake, did not immediately respond to a request for comment.

An external spokeswoman for Noble declined to comment and referred Reuters to the company’s statement on February 14 when Noble had said it was in discussions regarding a possible strategic investment in the company but no binding arrangement had been entered into.

It said when announcing its quarterly loss this month that it was still in talks with strategic investors.

The sources declined to be identified.