CMB’s court-ordered Euronav offer falls short of market

CMB has reopened its mandatory offer for the remaining shares in Euronav after Belgium’s Financial Services and Markets Authority (FSMA) ordered the shipping group to pay $36m to Euronav shareholders and reopen the bid to those who may have missed out the first time around.

Despite being raised by over half a dollar in line with the regulator's recommendation, shareholders would currently get a better price selling on the open market. Confusing the matter, Euronav the company has since been renamed CMB.TECH, and Euronav has become a CMB.TECH brand.

The reopened bid seeks to redress an issue with CMB's initial mandatory offer for outstanding Euronav shares, a bid which closed on March 15, 2024. Belgium’s market court found that Frontline gained $46m in special benefits from the sale of Euronav’s VLCC fleet, benefits that were not accounted for in the bid price of $18.43 per share.

The bid has reopened with an offer $0.52 per share higher, as recommended by Belgian authorities, but reduced by $6.29 to account for distributions made to shareholders since the bid was announced in October 2023. The resulting $12.66 per share offer is below the last market close for Euronav shares at $15.80, and the $16.21 close price for October 21.

The CMB supervisory board has recommended shareholders do not take up the offer.

Related:Regulator orders CMB to pay $36m to Euronav shareholders

CMB will also rectify the $0.52 discrepancy to shareholders who did take up the initial mandatory offer through cash payments which will total around $36m and be made on October 31.

The Belgian court ruling came as the result of action by investor FourWorld, which is attempting to turn back the clock to January 2023.

FourWorld seeks to unwind CMB’s mandatory takeover bid for Euronav and the sale of Euronav’s VLCC fleet to Frontline. Its case also seeks to unwind Euronav’s October 2023 decision to drop legal action against Frontline over the inciting incident for the long saga; in January 2023, Frontline unilaterally abandoned plans to merge with Euronav, kicking off a tense power struggle for control of Euronav between parties with competing visions for Euronav and its VLCC fleet.

The case is scheduled to appear before the Antwerp Enterprise Court in May 2026, said FourWorld.