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Acquisition"), a newly-formed company owned and controlled by a fund managed by
Maritime Partners, of a share purchase agreement (the “SPA”) for PM
Acquisition’s purchase of American Tanker Holding Company, Inc. (“ATHC”), a
wholly-owned subsidiary of AMSC (the “Transaction”).
Pål Lothe Magnussen, CEO of AMSC commented that “the management team at AMSC is
pleased that a Maritime Partners managed fund, a leading Jones Act leasing
company, is acquiring our Jones Act business. We believe this is the ideal new
owner of this business for the next phase in the lifecycle of these assets.
AMSC’s ownership tenure has surpassed 18 years since the ships were ordered,
during which significant financial profits have been created and provided to
AMSC and its shareholders. We believe that the long remaining commercial life of
the fleet in combination with strong bareboat charter contract cover in a strong
market represents a good opportunity and point in time for us to reconsider
capital allocation for AMSC and strategy going forward, and this transaction is
a natural step in this process.”
Key terms of the Transaction
ATHC, directly or indirectly, owns all shares in each of American Shipping
Corporation, American Tanker, Inc., ASC Leasing I, Inc, ASC Leasing II, Inc, ASC
Leasing III, Inc, ASC Leasing IV, Inc ASC Leasing V, Inc, ASC Leasing VI, Inc
and ASC Leasing VII, Inc, ASC Leasing VIII, Inc, ASC Leasing IX, Inc and ASC
Leasing X, Inc. The Transaction does accordingly comprise all of the ownership
interests in AMSC group’s ten vessels operating in the U.S. Jones Act market and
related activities.
AMSC will receive cash proceeds from the Transaction of in aggregate USD 249.3
million, divided between consideration for the shares in ATHC and repayment of a
shareholder loan, reflecting an enterprise value of ATHC of USD 746.7 million
based on the balance sheet of ATHC as at March 31, 2023. The consideration
represents a premium to current implied trading value of AMSC and a valuation of
ATHC that is 2.4x book equity (based on year end 2022 book equity and including
the shareholder loan) and EV/EBITDA (2022) ratio of 9.1x and P/E ratio of 19.8x
(2022).
Pursuant to the SPA, the purchase price for the shares will be adjusted for any
deviation (positive or negative) between budgeted and actually incurred capex
relating to a 15 year special survey for each of the MR tanker vessels Seakay
Star and Seakay Valor, and certain other non-material planned capex items. The
special survey for Seakay Valor was completed during the second quarter of 2023,
and Seakay Star is scheduled to be completed during the fourth quarter of 2023.
USD 246.3 million of the gross cash proceeds are payable to AMSC at completion
of the Transaction, while the remaining USD 3 million (as adjusted, if relevant)
is expected to be paid during the first quarter of 2024.
Completion of the Transaction is subject to the approval of the Transaction by
the AMSC general meeting with no less than a 2/3 majority of the shares and the
votes represented at the general meeting, which also is in line with the
recommendation in section 14 of the Norwegian Code of Practice for Corporate
Governance. Notice of an extraordinary general meeting to consider the
Transaction (the “EGM”) is expected to be sent to the AMSC shareholders on or
about August 29, 2023, and the EGM is expected to be held during the second half
of September 2023. Completion is in addition conditional upon the fulfilment of
certain customary conditions, including, inter alia, expiry or termination of
the waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act,
no material breach of the SPA and absence of material adverse event.
The main shareholders in AMSC, Aker Capital AS and DNB Bank ASA, holding in
aggregate 34.61% of the shares and votes in AMSC, have irrevocably and
unconditionally agreed to exercise all voting rights in respect of its
respective shares in AMSC in favor of the Transaction.
AMSC has given certain customary representations and warranties in respect of
ATHC, its subsidiaries, financial position, tax matters, assets, rights,
obligations, business and operations as at the date of signing of the SPA and as
of completion of the Transaction. Any breach of fundamental warranties, such as
ownership to shares in ATHC or a subsidiary, or warranties relating to tax
matters can in general only be claimed by the Buyer under a W&I insurance taken
out in connection with the Transaction, and AMSC may in practice only be liable
if a breach of any such warranty is caused by wilful misconduct or fraud by
AMSC. For breach of any other warranty, AMSC may, subject to certain customary
limitations, be held liable up to an amount of USD 40 million for a period of 12
months following completion of the Transaction.
Completion of the Transaction is expected to occur on or before October 31,
2023. In the event completion has not occurred within December 22, 2023, each
party has a right to terminate the SPA, and accordingly abandon the Transaction,
provided that the party wanting to terminate has not caused the delay, and
further provided that the parties have discussed in good faith a potential
extension of the said deadline prior to such termination.
As security for any claims under the SPA, AMSC has undertaken, for a period of
12 months following completion of the Transaction, to maintain a minimum equity
of USD 45 million.
In respect of the Senior Unsecured USD 220,000,000 Callable Bond Issue 2020/2025
(ISIN NO 0010886328), issued by American Tanker, Inc., a fully owned subsidiary
of ATHC, the intention is to call for a bondholder meeting to seek bondholders’
approval for certain amendments to the bond terms.
AMSC going forward
Following closing of the Transaction, the board of directors of AMSC intends to
resolve paying an additional dividend of USD 170 million. The expected
additional dividend equates to about NOK 25.1 per share assuming a NOK/USD
exchange rate of 10.6. AMSC will retain the remaining cash proceeds from the
Transaction to be used for general corporate purposes and equity for future
investments in new projects.
AMSC will continue to own the Normand Maximus on bareboat contract to a single
purpose subsidiary of Solstad Offshore. This business unit generates an annual
EBITDA of about USD 30 million and provides significant dividend capacity.
AMSC will remain as a public company with shares listed on the Euronext Oslo
Stock Exchange and continue to grow within the maritime ship owning and ship
leasing market. Aker will remain as a key shareholder, and the existing
management and board of directors will continue as is.
AMSC will continue to seek attractive risk/reward projects offering flexible
solutions to operators in the shipping and offshore markets, targeting medium
term contracts with extension optionality, and preferably participating in
future upside through profit sharing mechanisms.
AMSC will continue to pay quarterly attractive dividends.
Company Contacts
Pål Lothe Magnussen, +47 90 54 59 59, pm@amscasa.com
About AMSC
Established in 2005 and listed on the Euronext Oslo Stock Exchange (ticker
AMSC), AMSC is a ship owning company with nine modern handy size product
tankers, one modern handy size shuttle tanker and one subsea construction vessel
on bareboat charters with various counterparties. AMSC has a significant
contract backlog, as well as profit sharing agreements, which offers visibility
with respect to future earnings and potential dividend capacity. Following
completion of the Transaction, the only remaining vessel of the group will be
the subsea construction vessel Normand Maximus, which is chartered to a single
purpose subsidiary of Solstad Offshore ASA.
AMSC’s ambition to pay attractive dividends to its shareholders remains after
completion of the Transaction. Further information is available at
www.amscasa.com.
This information is considered to include inside information pursuant to the EU
Market Abuse Regulation article 7 and is subject to the disclosure requirements
pursuant to section 5-12 of the Norwegian Securities Trading Act.
This stock exchange announcement was published by Morten Bakke, CFO, AMSC ASA,
on August 22, 2023 at 08:32 CET.
This communication is not an offer to sell or purchase, or the solicitation of
an offer to sell or purchase, any securities, or the solicitation of a proxy, in
any jurisdiction in which, or to any person to whom, such offer, sale or
solicitation is not authorized or would be unlawful.
Kilde
