BW LPG completes VLGC fleet acquisition from Avance Gas

BW LPG has finalised the acquisition of a fleet of 12 very large gas carriers (VLGCs) from Avance Gas Holding Ltd in a transaction valued at US$1Bn. The completion was marked by the delivery of 2023-built dual-fuel VLGC Avance Avior, the final vessel in the transaction.

The terms of the agreement include issuing 2.141M BW LPG shares to Avance Gas, making Avance Gas the second-largest shareholder in BW LPG with a 12.1% stake in the company. Adjusted for BW LPG’s treasury shares, this ownership rises to 12.7%.

Avance Gas has announced plans to distribute these shares to its own shareholders after a mandatory 40-day lock-up period, with further details expected alongside its Q4 2024 financial results in February 2025.

In addition to the shareholding, the transaction generated approximately US$240M in net cash proceeds for Avance Gas, with US$30M received after the final vessel’s delivery and debt repayment.

The deal also yielded a book gain of US$287M for the company, to be reflected in its Q4 earnings.

Avance Gas chief executive Øystein Kalleklev is happy with the smooth completion of the fleet transfer and highlighted the company’s intention to wind down operations, subject to shareholder approval at a Special General Meeting in February 2025.

This transaction signifies consolidation in the VLGC sector, with BW LPG strengthening its position as a key player in the global gas shipping market.

Avance Gas, meanwhile, prepares to distribute its assets to shareholders and transition towards concluding its corporate operations.