Belgium’s tanker shipping company Euronav has concluded the merger with US-based crude oil shipping company Gener8 Maritime.
The 60.9 million new shares issued to Gener8 shareholders as consideration for the transaction will begin trading on the NYSE on June 13. The move follows the recent combination approval granted by Gener8 Maritime’s shareholders.
“Today marks an important milestone in the continued development of Euronav. Completing this transaction provides the crude tanker market with a global player of substantial size,” Paddy Rodgers, CEO of Euronav, said.
The merger creates an independent large crude tanker operator with a fleet of 76 operating crude tankers, consisting of 43 VLCCs, 27 Suezmaxes, 2 ULCC, two Panamax tankers and two FSOs under joint venture – representing over 19.4 million dwt in aggregate.
The merged entity has balance sheet assets of over USD 4 billion, an estimated pro-forma market capitalization of USD 2 billion based on Euronav’s closing price of USD 9.10 per share on June 11, 2018, and marked-to-market leverage of less than 50%.
Additionally, the operator has a liquidity position estimated at more than USD 800 million, including cash on hand and undrawn amounts available under existing credit facilities; tangible economies of scale via pooling arrangements, procurement opportunities, reduced overhead and enhanced access to capital; and a well-capitalised, highly liquid company for investors wanting to participate in the tanker market.
Furthermore, increase of the scale of the Tankers International Pool (a spot market-oriented tanker pool) to 65 VLCCs will allow the company to continue to provide the lowest commercial fees as a percentage of revenue in the sector, according to Euronav.