Reference is made to the joint announcement made by AMSC ASA (“AMSC”) and Maritime Partners, LLC. regarding the signing by AMSC and Project Merchant Acquisition LLC, a newly-formed company owned and controlled by a fund managed by Maritime Partners, of a share purchase agreement for PM acquisition’s purchase of American Tanker Holding Company, Inc., a wholly-owned subsidiary of AMSC.
ATHC, directly or indirectly, owns all shares in each of American Shipping Corporation, American Tanker, Inc., ASC Leasing I, Inc, ASC Leasing II, Inc, ASC Leasing III, Inc, ASC Leasing IV, Inc ASC Leasing V, Inc, ASC Leasing VI, Inc and ASC Leasing VII, Inc, ASC Leasing VIII, Inc, ASC Leasing IX, Inc and ASC Leasing X, Inc. The transaction does accordingly comprise all of the ownership interests in AMSC group’s ten vessels operating in the U.S. Jones Act market and related activities.
AMSC will receive cash proceeds from the transaction of in aggregate USD 249.3 million, divided between consideration for the shares in ATHC and repayment of a shareholder loan, reflecting an enterprise value of ATHC of USD 746.7 million based on the balance sheet of ATHC as at March 31, 2023. The consideration represents a premium to current implied trading value of AMSC and a valuation of ATHC that is 2.4x book equity (based on year end 2022 book equity and including the shareholder loan) and EV/EBITDA (2022) ratio of 9.1x and P/E ratio of 19.8x (2022).
Completion of the transaction is subject to the approval of the transaction by the AMSC general meeting with no less than a 2/3 majority of the shares and the votes represented at the general meeting, which also is in line with the recommendation in section 14 of the Norwegian Code of Practice for Corporate Governance. Notice of an extraordinary general meeting to consider the transaction (the “EGM”) is expected to be sent to the AMSC shareholders on or about August 29, 2023, and the EGM is expected to be held during the second half of September 2023. Completion is in addition conditional upon the fulfilment of certain customary conditions, including, inter alia, expiry or termination of the waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act, no material breach of the SPA and absence of material adverse event.
The main shareholders in AMSC, Aker Capital AS and DNB Bank ASA, holding in aggregate 34.61% of the shares and votes in AMSC, have irrevocably and unconditionally agreed to exercise all voting rights in respect of its respective shares in AMSC in favor of the Transaction.
Completion of the Transaction is expected to occur on or before October 31, 2023. In the event completion has not occurred within December 22, 2023, each party has a right to terminate the SPA.
As security for any claims under the SPA, AMSC has undertaken, for a period of 12 months following completion of the transaction, to maintain a minimum equity of USD 45 million.
Established in 2005 and listed on the Euronext Oslo Stock Exchange, AMSC is a ship owning company with nine modern handy size product tankers, one modern handy size shuttle tanker and one subsea construction vessel on bareboat charters with various counterparties. AMSC has a significant contract backlog, as well as profit sharing agreements, which offers visibility with respect to future earnings and potential dividend capacity.