Saltchuk to Acquire Overseas Shipholding Group in $950 Million Deal

Seattle-based Saltchuk Resources, a diverse freight transportation and services company, has entered into a definitive agreement to acquire Overseas Shipholding Group (OSG) in a deal worth $950 million.

OSG, a publicly traded company, specializes in liquid bulk transportation services for crude oil and petroleum products in the U.S. Flag markets. The transaction, which values OSG’s equity at approximately $653 million, has been unanimously approved by the Boards of Directors of both companies.

Saltchuk’s notable brands include Tote and Foss, among others.

Under the agreement, Saltchuk will initiate a tender offer to acquire all outstanding shares of OSG it does not own for $8.50 per share in cash. This offer represents a 61% premium on OSG’s 30-day volume-weighted average price on January 26, 2024, and a 36% premium on Saltchuk’s initial indicative price of $6.25 per share.

Douglas D. Wheat, Chairman of the OSG Board of Directors, said that after receiving Saltchuk’s indication of interest at the end of January, the board undertook a comprehensive review of the company’s financial and strategic alternatives. He said the board engaged with Saltchuk and other potential transaction partners before deciding that Saltchuk’s increased offer was in the best interest of OSG’s shareholders.

“We are excited to enter into this new chapter together with Saltchuk, which has been a significant shareholder of OSG over the past several years and has a close understanding of our business,” said Sam Norton, OSG’s President and Chief Executive Officer. “Saltchuk’s operating companies have distinguished themselves in their respective segments, and this transaction partners us with an organization that shares our values and focus on customers. We are thrilled to soon join the Saltchuk family of companies.”

Upon completion of the transaction, OSG will operate as a standalone business unit within Saltchuk and will join its family of diversified freight transportation and marine service companies. The transaction is expected to close in the next few months and is not subject to a financing condition. It will be funded through a combination of committed debt financing and cash on hand.

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