Antwerp-based tanker shipping company Euronav remains in Belgian hands. Compagnie Maritime Belge (CMB) and the Norwegian Frontline, Euronav’s two major shareholders, have reached an agreement on the matter.
The agreement is described as one of the largest deals in the shipping industry in recent decades. “A huge milestone”, says CMB CEO Alexander Saverys, who is “proud that the company is not going abroad” and that he was able to avert a merger.
The agreement between the two shipping dynasties involves John Frederiksen’s group, the strongman behind Frontline, selling its 26,12% stake in Euronav to CMB, owned by the well-known Saverys family of shipowners.
At the same time, Frederiksen is buying 24 supertankers from Euronav, about a third of the total fleet of Euronav’s current 69 vessels – Frontline now has 89. The total value of the ships is 2,35 billion dollars.
In turn, CMB is putting just over a billion dollars on the table for Frontline’s stake in Euronav. This repurchase will be financed by the sale of Euronav shares (252 million dollars), available cash, drawings from credit facilities, and a new loan of 1,41 billion euros.
At the same time, it also ends the arbitration proceedings between Euronav and Frontline after a robust batch of arm wrestling that lasted a good two years.
Still on the stock exchange
CMB CEO Alexander Saverys stresses that Euronav, before the deal the world’s largest oil tanker shipping company, will not be taken off the stock exchange, something he did eight years ago with CMB itself.
“We don’t want to delist Euronav”, Saverys says. “We really want to stay on the stock market. In fact, there are big differences from eight years ago. A stock exchange serves for pennies and visibility; CMB didn’t need that. But Euronav is a company within the energy transition, and so we are retaining the brand for a piece.”
Saverys has long dwelt on greening the Euronav fleet. “And now we are a big step closer in practice”, dixit Saverys. CMB.TECH, a subsidiary of CMB that is betting on ammonia and hydrogen, among other things, will get a serious boost. “That must be funded, and that’s why we need the grant. We already have a greener fleet at CMB; we are going to add that to Euronav.”
So, the CEO wants to bring both stories together. On one side, a large, publicly traded company needs and will phase out the transportation of purely crude oil but will also transport low-carbon fuels such as ammonia and hydrogen. On the other hand, a smaller “clean tech” player will develop technology and produce fuels.
In time, Saverys could thus become its own customer. In Namibia, for example, CMB is betting heavily on hydrogen production. “It is an advantage with Euronav that we can now accelerate our investments there”, the CEO concludes.
A decision on what happens to the dividend policy is not expected until after the general meeting at the end of November.