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Euronav’s Updates in Week 24

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Jun. 21 2018, Updated 9:00 a.m. ET

Merger

On June 13, Euronav (EURN) successfully concluded the merger with Gener8 Maritime Partners. As part of the merger, 60.9 million new shares were issued to Gener8 Maritime’s shareholders. The merger has substantially increased Euronav’s size.

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After the merger

After the merger, Euronav will have balance sheet assets of over $4 billion. Based on Euronav’s closing stock price on June 11, the company will have a pro forma market capitalization of $2 billion. The company’s mark-to-market leverage will likely be less than 50%.

Vessel sale

On June 15, Euronav sold six VLCCs (very large crude carriers) to Seaways. The company sold six vessels for a consideration of $434 million, which includes $123 million in cash and $311 million in outstanding debt related to the vessels. Out of the six vessels, five vessels were built in 2016 and one vessel was built in 2015. According to management, the transaction gives the company substantial liquidity going forward.

The company operates 76 crude tankers consisting of 43 VLCCs, 27 Suezmaxes, two ULCCs, two Panamax tankers, and two FSO’s under a joint venture.

Peers

Nordic American Tankers (NAT) has a fleet of 33 Suezmax vessels. Teekay Tankers (TNK) operates 66 vessels—60 vessels are owned by the company and six vessels are chartered in. Navios Maritime Midstream Partners (NAP) operates nine VLCCs.

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