Danish tanker company Torm is boosting its fleet portfolio with the addition of eight second-hand LR2 vessels in a $399m cash and shares deal.
The deal was sealed on November 9, and the tanker owner is now buying the vessels for a total consideration of $399m, with a cash consideration of $239m and the issuance of approximately 5.5 million shares.
The LR2 ships are expected to be delivered to the company in late Q4 2023 and in Q1 2024.
The owner didn´t disclose the name of the seller but said all units had been built at the Tier 1-Korean yard Hyundai Samho Heavy Industries between 2010 and 2012.
The purchase price is subject to certain adjustments that will be impacted by TORM’s share price development, and the vessels’ delivery schedules.
The Danish owner claims the units come with “fuel-efficient eco vessel specifications.”
Furthermore, it was said that the cash element of the transaction is expected to be financed through a combination of different debt financing sources. Torm will issue the relevant shares in connection with the eight vessels, whilst the transaction is not expected to impact Torm’s guidance on TCE or Ebitda for the full year 2023.
Jacob Meldgaard, chief executive of Torm, said: “We are pleased with this opportunity to increase our exposure to the LR2 segment, as we see strong demand-drivers in this segment in the coming years. As always, we focus on the expected return on capital invested and we believe that it is value accretive and particularly interesting for our shareholders to use issuance of new shares as part of the consideration.”
Torm, a large carrier of refined oil products, operates a fleet of approximately 85 product tanker vessels, and its shares are listed on Nasdaq in Copenhagen and on Nasdaq in New York.
