Euronav: arbitration dismissed, board seats proffered, meeting date set

In the wake of a full dismissal of its arbitration claims over the breakdown of a proposed merger with John Fredriksen’s Frontline, Euronav management has responded with an offer of two newly created board seats each for its two largest shareholders: John Fredriksen-controlled businesses and Saverys-family-controlled Compagnie Maritime Belgium (CMB). 

In a message to investors communicating the dismissal of the arbitration proceedings, Euronav said CMB had indicated its disinclination to accept the two new seats on the Euronav board.

"CMB NV has on 6 February 2023 responded that it is not inclined to agree and that all mandates should be up for discussion to allow for a comprehensive deliberation," the Euronav letter said.

Euronav went into greater detail in a letter to investors on 13 February, in which the company set out its guidance for how it feels investors should vote on a series of proposed agenda items at the upcoming special general meeting (SGM) called for 23 March 2023.

The agenda items, primarily put forward by CMB, include ousting the current five members of Euronav’s supervisory board. Euronav said it recommends voting against that proposal but voting for two of the five candidates proposed as replacements to the existing Euronav board, Saverys family patriarch Marc Saverys and Patrick De Brabanere, as "non-independent shareholder nominated Supervisory Board members".

Euronav said CMB has thus far declined to participate in the "required process" of allowing Euronav to interview, evaluate and validate CMB’s remaining three proposed candidates for the Euronav board as set out in "Belgian company law and corporate governance".

Euronav also suggested voting for any formalised resolutions proposed by Frederiksen-controlled Famatown Finance to nominate Mr Fredriksen and investment fund manager Cato Stonex, who has founded multiple investment firms and from 2021 has backed WMC Capital, an investment company focused on the recovery of the global shipping industry. Famatown Finance publicly stated its intent to accept Euronav’s offer of additional seats on the board with the two candidates, but according to Euronav’s press release, compliance procedures remain to be observed under Belgian corporate law.  

The seats offered to Famatown and CMB would expand the total number of supervisory board members to nine, while retaining its current membership. Euronav defended its existing board members as each being "individually highly qualified to make unique and substantial contributions".

"The Supervisory Board of Euronav believes that the strong results of the company, in particular those of the full year 2022, including the well-received net-zero strategy for decarbonisation, are a validation of the governance, forward thinking strategic direction and oversight by its highly engaged and independent Supervisory Board," Euronav’s letter said.

"It is the Supervisory Board’s hope and expectation that its recommendations will result in a balanced board which will not only reflect Euronav’s current shareholder base but also maintain the level of governance and business continuity necessary to ensure value creation for all stakeholders."