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Euronav fights war on two fronts

Euronav Euronav Crew at work on deck
Euronav is pursuing legal action to revive its merger with Frontline while major stakeholder CMB seeks a clean sweep of Euronav’s supervisory board.

The latest developments in the tumultuous bid to merge tanker giants Frontline and Euronav sees Euronav fighting within and without.

Euronav announced on January 18 that it has applied for “urgent interim and conservatory measures” relating to Frontline’s decision last week to unilaterally terminate the companies’ merger agreement. Euronav seeks to suspend Frontline’s termination of the deal while the performance of the merger agreement and merits of Frontline’s termination of the deal are considered.

“Euronav reiterates its determination that Frontline’s unilateral action in pursuing the termination of the combination agreement has no basis under the terms of the combination agreement and that Frontline failed to provide a satisfactory reason for its decision to pursue termination,” the company said in a release.

“After careful consideration, the Supervisory Board, entirely composed of independent directors, has considered that this decision is in the corporate benefit of Euronav.”

As the supervisory board exercises its power, Euronav major shareholder Compagnie Maritime Belge (CMB) seeks a clean sweep of the supervisory board. The Saverys-controlled company has requested a shareholders’ meeting with a clear agenda – dismiss the five current members of the supervisory board and vote in replacements. CMB has nominated five candidates including three independents and two with CMB interests.

CMB has been a thorn in the side of the proposed merger of Euronav and Frontline, formally requesting in December 2022 that it be terminated. At Euronav’s AGM in May 2022, CMB nominated three new directors to the Euronav board who were against the merger but shareholders voted for Euronav’s own, pro-merger appointees.

Euronav is also taking action against shareholders Frontline plc, Famatown Finance Limited, Hemen Holding Limited and Geveran Trading Co whose combined holdings represent 20.3% of Euronav shares after Famatown bought around 5m additional shares last week.  The scale of the related companies’ holdings could qualify them as a related party under IAS24 and subject them to the relevant disclosure requirements, according to Euronav.

“As a precautionary measure the Supervisory Board has therefore taken the decision in relation to the initiation of proceedings against Frontline plc, Famatown Finance Limited, Hemen Holding Limited and Geveran Trading Co. Limited in accordance with the procedure provided for in article 7:116 of the Belgian Code of Companies and Associations,” the company said in a release.

TAGS: Europe