If the announced merger of tanker carriers Euronav and Frontline is realized, shipping will for the first time have a tanker operator so big that it may appeal to external investors, estimates advisory firm Evercore.
Tanker operators Euronav and Frontline are not just in the process of merging into a gigantic tanker company compared to their competitors – the merger will also for the first time create a tanker carrier of a size that shares are likely to become interesting to a broader group of investors, according to investment banking advisory firm Evercore.
”For tanker investors and for the general investor base globally, the potential combination would create a truly investible tanker company with a meaningful and liquid market cap,” writes Evercore in a comment on the planned fusion.
The merger has not yet been approved, and shareholders in the two companies do not agree on the merger plans, however, if it becomes reality, the combined company under the Frontline name will be miles ahead of its competitors measured on fleet size.
Together, Euronav and Frontline will command a fleet of 69 very large crude carriers (VLCCs), 57 suezmaxes and 20 /aframax vessels. In comparison, the closest competitor within crude oil tanker, DHT, controls 26 VLCCs, according to Evercore.
