Nasdaq-listed bulker owner Grindrod Shipping Holdings is buying through its subsidiary Grindrod Shipping Pte. Ltd. the entire issued share capital of Taylor Maritime Management Limited and Tamar Ship Management Limited for $11.75 million.
Specifically, the owner will acquire the share capital of Taylor Maritime Management Limited and Tamar Ship Management Limited from, in the case of Taylor Maritime Management Limited, Taylor Maritime Group Limited and, in the case of Tamar Ship Management Limited, Taylor Maritime Group Limited and Temeraire Holding (MI) Limited.
After the acquisition, which is subject to certain closing conditions, the companies will become wholly owned subsidiaries of Grindrod Shipping.
The closing of the transaction is expected to occur before mid-October 2023, but is subject to closing conditions, including, among other things, the repayment of debts owed by the companies and their subsidiaries to the sellers and by the sellers to the companies and their subsidiaries.
The deal will be financed through a combination of cash on hand and allotment of new Grindrod Shipping ordinary shares over the two years from completion.
The aggregate maximum value of the consideration for the acquisition will not exceed $13.5m.
At the discretion of the board of directors, in lieu of new share issuances, there is an option for any portion of the first year and second year consideration amounts to be paid in cash, at an increase of 1.10 times and 1.20 times, respectively.
The chief executive officer, Edward Buttery, is not involved in this transaction, as the companies have a framework management deal with TMI to act as their commercial and technical manager for TMI’s fleet.
Grindrod Shipping chairman, Dr. Kurt Klemme, noted that operations of Tamar Ship Management Limited and Taylor Maritime Management Limited are aligned with the company´s technical shipmanagement practice and its commercial strategy.
“This acquisition will further increase our revenue streams in terms of ship-management income, unlock synergies in our commercial deployment of the dry bulk fleet and we will achieve savings on the technical side with a larger fleet.
“With the central management of a combined group fleet, we will certainly achieve better returns to our shareholders,” Klemme added.
