The two European giants, Euronav and John Fredriksen’s Frontline, plan to combine their fleets in an all-share deal to create the continent’s largest tanker firm in which Fredriksen will hold a leading 22% stake once the deal is approved. The $4.2bn entity would be called Frontline, and be headed by Euronav’s CEO, Hugo De Stoop.
In an update to clients yesterday, Evercore ISI analysts said the merger would create a “supersized tanker behemoth” in an industry where most company market capitalisations are lower than $1bn.
The merged company would become the largest owner-operator of crude tanker tonnage, with a combined fleet of 69 VLCCs and 57 Suezmax vessels and 20 LR2/Aframax vessels. For perspective, DHT, which would be the second-largest crude tanker company following the merger, has a total of 26 VLCCs.