Frontline, Fredriksen Sell Euronav Stake to CMB to End Deadlock

By Stephen Treloar (Bloomberg) —

Frontline Plc, one of the world’s largest oil tanker owners, and Norwegian shipping billionaire John Fredriksen reached a deal to sell their combined 26% stake in Euronav NV to CMB NV. 

The $1.06 billion stake sale is part of a larger package that also included Frontline entering into agreements with Euronav to acquire 24 very large crude carriers for an aggregate purchase price of $2.35 billion, funded by the sale of the Euronav shares and a debt package, according to a statement. 

The deal brings to an end an 18-month stalemate between Frontline and one of Belgium’s oldest shipping families after the Norwegian firm walked away from merger discussions. Compagnie Maritime Belge, or CMB, was opposed to the deal from the outset, raising its stake in the company as the two camps vied for control of Euronav.

Frontline rose as much as 3.3% in Oslo, while Antwerp-based Euronav gained as much as 3.7%.

Following the deal, CMB will have 49% of shares and 53% of votes in Euronav, triggering a mandatory offer the rest of Euronav shares at the same price. The offer, once made, won’t have an acceptance threshold, Euronav said in a separate statement. 

“This transaction will solidify Frontline’s position as the leading publicly listed tanker company, and significantly expand our exposure towards modern efficient VLCCs at an opportune time in the cycle,” Fredriksen said in the statement. 

His company, Famatown Finance, first declared a stake in Euronav back in October 2021. 

The agreement also ends arbitration action filed by Euronav earlier this year following Frontline’s withdrawal from their combination agreement. Euronav’s independent directors’ committee said the deadlock between Euronav’s reference shareholders may adversely impact the company’s “ability to adapt to customer expectation and market evolutions, which is expected to become value destructive in the longer term.”

© 2023 Bloomberg L.P.

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