CMB's US$39M share buy takes Euronav stake to 25% and can block standard merger plans for Frontline and Euronav - Riviera Maritime
According to a new filing on the US Securities and Exchange Commission (SEC), CMB, controlled by the Saverys family, has purchased just over 2M Euronav shares for nearly US$39M, increasing its stake to 25%. The purchase corresponds to about 1.0% of the held stake in Euronav, according to Riviera Maritime.
Last week, John Fredriksen reduced his ownership interest in Europe’s largest tanker owner Euronav, a merger target for the Fredriksen-controlled Frontline.
According to SEC filings, Fredriksen’s privately owned CK Ltd sold around 2M Euronav shares for US$39M, reducing its stake to 17.8%. The sale corresponds to about 1.0% of Euronav shares.
Fredriksen’s remaining 35.9M shares are valued at US$689M.
The Fredriksen share sale has provoked speculation as the high-profile battle for control of Euronav between the Saverys, Fredriksen entities and the majority of Euronav’s shareholders continues. No reason for the CK Ltd share sale has been given.
As shareholdings currently stand, Frontline and Euronav can still combine their fleets through a simple majority of 50% plus one vote to create the world’s largest tanker owner trading under the Frontline name with Euronav management and majority share.
Based on SEC rules, Mr Fredriksen must report any further share sales greater than 1% of company holdings within 24 hours of the trade.
In its recent Q3 earnings call on 8 December, Frontline noted it intends to carry on with the process of moving its headquarters and operations from Bermuda to redomicile the company in Cyprus as a precursor to the proposed merger. The company has called a meeting of shareholders to vote on the move. The meeting will be held on 20 December 2022 in Hamilton, Bermuda.
During the Q3 earnings call, Frontline Management chief executive Lars Barstad said, “The process of moving Frontline to Cyprus from Bermuda has proven complicated. There are lots of regulatory bodies involved and they use time. But we continue to be committed to this process.”
“However, the launch of the tender offer has slipped to Q1 next year. The outcome remains the same. Depending on how much support we get in the tender offer, if we get above 75%, we will have a merger or move for a merger. If we are between 50.1% and 75%, we will form a group.”
Frontline is expected to make an offer for Euronav’s shares in Q1 2023. The offer, as originally announced, would be for 1.45 Frontline shares for every Euronav share.
Frontline and Euronav have been pushing for a merger since April, and the Fredriksen group last increased its stake in June.
