Frontline and Euronav have announced they are combining fleets and operations, but Euronav’s major shareholder Compagnie Maritime Belge has said it does not support the takeover
Update: 8 April
In a statement released on 8 April 2022, Euronav’s major shareholder Compagnie Maritime Belge (CMB) said it did not support the takeover by John Fredriksen’s Frontline.
Belgium shipping and industrial conglomerate CMB founded Euronav some 30 years ago and CMB remains the largest shareholder in Euronav, with the Saverys family who control CMB having upped their stakes to more than 13% of Euronav’s total shareholdings in the last six months.
The Saverys family believes the purpose of the merger is misguided, saying “CMB questions the current strategy of Euronav, which focuses solely on the transportation of crude oil in a world where decarbonisation is of paramount importance. CMB does not believe a combination with Frontline will create added value for Euronav’s stakeholders.”
It added, “CMB would like to transform Euronav into a Europe-based marine and industrial cleantech powerhouse with a diversified fleet. The proceeds of Euronav’s current business should be reinvested in green hydrogen and ammonia ships and applications, and new type of vessels that carry the fuels of the future.”
In conclusion, the statement reads, “CMB will further endeavour to convince all stakeholders of Euronav of the benefits of its alternative strategy. In that regard, CMB will make appropriate proposals to Euronav’s shareholders’ meeting and actively engage in a dialogue between shareholders to reach that objective.”
7 April
Frontline and Euronav have announced they are in the later stages of a merger – the respective boards of directors have agreed a term sheet on a potential stock-for-stock combination between the two companies, based on an exchange ratio of 1.45 FRO shares for every EURN share resulting in Euronav and Frontline shareholders owning approximately 59% and 41%, respectively, of the combined group.
A foretaste of what was to come was broadcast when John Fredriken family’s interests took a stake in Euronav in October 2021. Through his private companies, Mr Fredriksen is a key shareholder in Frontline.
The combined group will continue under the name Frontline and continue to operate from Belgium, Norway, the UK, Singapore, Greece and the US.
Frontline will have a fleet of 69 VLCCs, 57 Suezmax tankers, and 20 LR2/Aframax tankers. Hugo De Stoop will head the group as chief executive.
Mr Fredriksen said, “A combination of Frontline and Euronav will establish a market leader in the tanker market and position the combined group for continued shareholder value creation in addition to significant synergies.”
He added, “The new Frontline will offer value-enhancing services for our customers and increase fleet utilisation and revenues which will benefit all stakeholders. I am very excited and give my full support and commitment to this combined platform”.
Euronav chief executive Hugo De Stoop said, “This transaction marks an exciting development for the tanker industry, creating a leading tanker company positioned to serve the needs of customers, support partners and drive technology and sustainability initiatives to lead the energy transition.”
Lazard is serving as financial advisor and Freshfields Bruckhaus Deringer LLP is serving as legal counsel to Euronav.
Advokatfirmaet Schjødt AS, Allen & Overy LLP, Seward & Kissel LLP (led by partner Keith Billotti, co-head of the firm’s Capital Markets Group) and MJM Limited are serving as legal counsel to Frontline in connection with the combination.
KPMG is advising Frontline on tax-related matters.
ABG Sundal Collier ASA is serving as financial advisor to Frontline and DNB Markets, a part of DNB Bank ASA, has acted as financial advisor to the independent part of the Frontline board.
The Chemical & Product Tanker Conference, London will be held 28 April 2022. Register your interest and access more information here
© 2023 Riviera Maritime Media Ltd.