Frontline Ltd. (FRO), an oil tanker shipping firm, said on Monday that it has inked a merger deal with Euronav NV (EURN), a Belgian oil transporter by sea.
The stock-for-stock combination is based on an exchange ratio of 1.45 Frontline-shares for every 1.0 Euronav-share, to create an independent listed oil tanker operator.
Based on the Frontline share price $8.34 as of July 8, the proposed exchange rate represents a share value of $12.09 per Euronav share.
The merger will form a company with a market capitalization of over $4 billion and will be listed on Euronext Brussels, OSE, and NYSE upon Tender Offer completion.
The new firm will be named Frontline, and headquartered in Cyprus. It will continue to operate in Europe and Asia including Belgium, Norway, the UK, Singapore, and Greece.
John Fredriksen, owner of the Bermuda-based Frontline, said: " Frontline, with a fleet of 146 vessels, will be able to offer value enhancing services for our customers and increase fleet utilisation and revenues which will benefit all stakeholders…"
For 2021, the combined net revenue and EBITDA of the two companies was around $668 million and $246 million, respectively.
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