Avance Gas to exit market as Exmar buys out four newbuild contracts

John Fredriksen-controlled Avance Gas is winding down operations and preparing to wind-up its business after the sale of its final four vessel holdings. 

The four mid-sized gas carriers sold to the Saverys family-owned Exmar were sold as contracts for newbuildings that are under construction in Asian yards. Mr Fredriksen and the Saverys family tussled over control of major European tanker owner Euronav throughout 2022 and 2023. The high-profile battle ended with a deal that saw Mr Fredricksen carve-out two dozen late-model VLCCs from the Euronav fleet in return for shares and a cash sum of US$2.35Bn. 

In the Avance Gas-Exmar, Fredriksen-Saverys agreement, the four 40,000-m³ MGCs changed hands for US$70.6M each, in a deal that totalled US$282.4M. Avance Gas said it will take a profit of US$34.0M in the deal along with a cash release of US$84.0M on US$50.0M in previously paid yard instalments. The vessels are scheduled to be delivered Q4 2025 and Q4 2026. 

"Avance Gas and Exmar LPG have reached an agreement which makes perfect industrial sense. Given its scale and specialisation within the MGC segment, Exmar is perfectly positioned to be the owner of these ultra- modern ships. For Avance Gas, we are once again able to transact profitabl[y] by evidencing our willingness to take part in industrial consolidation where we put industrial logic and shareholder value creation ahead of growth," Avance Gas Holding chief executive Øystein Kalleklev said in the company’s Q3 earnings release.

"As we are not planning to invest in new ships, we are now preparing a wind-up process of Avance Gas to ensure we can return the remaining capital to our shareholders," he said.

Avance Gas also reported it has delivered the first four very large gas carriers (VLGCs) purchased by BW LPG in a sale totalling a dozen vessels. The sale, at just over US$1.00Bn, brought in a profit of nearly US$300.0M, according to Avance Gas. It also made Avance Gas Holdings the second-largest shareholder in BW LPG. The remaining eight VLGCs are scheduled for delivery before the end of 2024.

"Our plan is to reduce our capital to make the repayment of capital tax efficient while also distributing the BW LPG shares to our shareholders once the lock-up period for all shares has elapsed, which coincide[s] with our Q4 reporting in February next year," the company said.