NYSE-listed Euronav has confirmed that it is in advanced discussions to buy four VLCCs from Greece’s Metrostar.
Euronav, which is led by CEO Paddy Rogers, disclosed on 11 June that the acquisitions “would be funded from debt and existing liquidity available under revolving facilities”. The deal would not require a follow-on equity offering, nor would it impact the company‘s dividend policy, said Euronav.
The announcement came after a report in the Wall Street Journal that Euronav was poised to acquire VLCCs from Metrostar and Suezmaxes from Connecticut-based Principal Maritime. Euronav asserted in its statement that it “has not made an offer on other vessels, specifically the Principal Maritime Suezmax vessels”.
According to Wells Fargo analyst Michael Webber, “While Euronav did not disclose a transaction price, we believe the deal to be in the USD388 million range (USD97 million/vessel).” Webber pointed to four Metrostar VLCC orders at Hyundai Merchant Marine to be delivered in 4Q15-2Q16 as the vessels to be acquired.
Both Webber and Morgan Stanley analyst Fotis Giannakoulis noted that the four Metrostar newbuild contracts have four options attached. Giannakoulis opined that Euronav is likely to exercise those options as well.
Giannakoulis estimated that Euronav has the liquidity to buy an additional USD800 million worth of assets in addition to the four Metrostar VLCCs.