FRO - New DHT Offer Proposal
(Thomson Reuters ONE) -
Frontline Ltd. (NYSE/OSE: FRO) has previously disclosed that it has submitted
several proposals to the management and Board of DHT Holdings Inc. (NYSE: DHT)
to effectuate a business combination between Frontline and DHT. Since at least
the date of the proposal made on January 27, 2017, Frontline has actively sought
to engage the management and Board of DHT on the good faith understanding that
they would take actions that would be in the best interests of DHT's
shareholders.
Frontline has now approached the Board of Directors of DHT to consider a
proposed new business combination, which includes the ships already delivered
and yet to be delivered by BW Group Ltd. to DHT under the Vessel Acquisition
Agreement ("VAA") entered into by DHT and BW on March 23, 2017. The offer would
be effected at an exchange ratio of 0.8 Frontline shares for each DHT common
share. Frontline's offer is further detailed in the April 25, 2017 letter to the
DHT board, which is set out below.
The proposed new combination of Frontline and DHT, which represented a 18%
premium to DHT's volume weighted average price for the 10 days immediately prior
to the opening market price on April 21, 2017, and 15.8% premium to the latest
30-day volume weighted average price, is expected to yield increased benefits.
In particular, it is expected that the combination would create the largest
public tanker company by fleet size, market capitalization and trading
liquidity; DHT shareholders would benefit from a substantially lower G&A cost
per vessel and profit from synergy values. Frontline's superior access to debt
and equity capital markets should enhance free cash flow generation further.
Frontline trusts that the Board of DHT will now engage with Frontline in order
to negotiate mutually satisfactory transaction documents, and will halt all
efforts to give effect to the various entrenchment measures it has implemented
aimed at thwarting Frontline's offers. The effect of the VAA and the Investor
Rights Agreement, combined with DHT's staggered board of directors and the
Shareholder Rights Plan it introduced on January 29, 2017 in response to
Frontline's offer, has been to give BW an unassailable advantage over any other
bidder for DHT and ensure that there is no realistic opportunity for any other
offer to emerge for DHT, except for an offer from BW.
Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS says:
"We are convinced that the proposed new combination of Frontline and DHT will
maximize value for both sets of shareholders. We believe that this outcome is in
the best interests of shareholders of both companies and will seek to ensure
that shareholders of DHT have an opportunity to consider our offer. We look
forward to engaging DHT management and its Board to achieve a mutually
beneficial combination with Frontline."
Copy of the Offer Letter sent by Frontline to the DHT Board on April 25, 2017
DHT Management AS
Haakon VIIs GT.1, 7th floor
POB 2039 Vika, 0125 Oslo,
Norway
For the attention of: Erik A. Lind, Chairman of the Board of Directors
Oslo, 25 April 2017
Terms for the proposed combination of Frontline, Ltd. and DHT Holdings, Inc.
Dear Mr Lind,
We write to ask the Board of Directors of DHT Holdings, Inc. ("DHT") to consider
a proposed business combination ("offer") with Frontline Ltd. ("FRO" or
"Frontline"), which may be effected by way of a one-step merger, tender offer or
other appropriate structure.
The offer includes the ships delivered and to be delivered by BW Group Limited
("BW") to DHT under the Vessel Acquisition Agreement ("VAA") and takes into
account shares of common and preferred stock of DHT issued and to be issued to
BW thereunder.
The offer would be effected at an exchange ratio of 0.8 Frontline shares for
each DHT common share.
The terms of the offer have been approved by Frontline's Board of Directors, are
not subject to any financing condition and are conditioned only on fulfilment
(or waiver by Frontline) of the following conditions: (a) the negotiation and
execution of mutually satisfactory transaction documents between Frontline, DHT
and, if applicable, BW; (b) approval from the requisite majority of DHT
stockholders of any one-step merger with Frontline or Frontline receiving
acceptances from stockholders which, together with its and its affiliates'
holdings, represent not less than 50.01% of the outstanding voting stock of DHT
(including both common and preferred stock voting as a single class, as well as
shares to be issued pursuant to the VAA); and (c) termination of, or the grant
by a court of competent jurisdiction of permanent injunction(s) in respect of:
(i) the DHT Rights Agreement dated as of January 29, 2017; and (ii) the Investor
Rights Agreement ("IRA") with BW and, in particular, those provisions of the IRA
which prevent or preclude Frontline from consummating the offer if approved or
accepted as contemplated by (b) above (collectively, the "poison pill
arrangements").
When it is commenced, the offer to all DHT's shareholders will remain open for
at least 45 days.
The poison pill arrangements, together with the DHT Board of Directors' decision
not to permit DHT shareholders to consider and vote on any of our prior offer
proposals, contravene the duties DHT's Board owes to all its shareholders.
Moreover, the poison pill arrangements threaten to inflict irreparable harm on
DHT, as well as Frontline, by effectively blocking any entity besides BW from
engaging in a business combination with DHT.
We therefore demand that you immediately halt all efforts to enforce, give
effect to or permit, the poison pill arrangements, and that you permit DHT
stockholders the opportunity to consider and vote on the offer. Please confirm
by 12 noon, New York time, tomorrow (April 26, 2017) that you will immediately
halt all efforts to enforce, give effect to or permit, the poison pill
arrangements and will commence negotiations with Frontline on mutually
satisfactory transaction documents.
The proposal outlined in this letter is based on publicly available information.
Yours sincerely,
Robert Hvide Macleod
Principal Executive Officer
Frontline Ltd.
April 25, 2017
The Board of Directors
Frontline Ltd.
Hamilton, Bermuda
Contacts:
Robert Hvide Macleod: Chief Executive Officer, Frontline Management AS
+47 23 11 40 84
Inger M. Klemp: Chief Financial Officer, Frontline Management AS
+47 23 11 40 76
Additional Information
This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval. This
communication relates to a proposed business combination transaction with DHT
proposed by Frontline, which may become the subject of a registration statement
filed with the Securities and Exchange Commission (the "SEC"). This material is
not a substitute for the prospectus and/or proxy statement Frontline would file
with the SEC regarding the proposed transaction if such a negotiated transaction
with DHT is reached or for any other document which Frontline may file with the
SEC or send to DHT or Frontline stockholders in connection with the proposed
transaction. INVESTORS AND SECURITY HOLDERS OF Frontline AND DHT ARE URGED TO
READ ANY SUCH DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY IF AND
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT
THE PROPOSED TRANSACTION. Such documents would be available free of charge
through the web site maintained by the SEC at www.sec.gov
Forward-Looking Statements
Matters discussed in this communication may constitute forward-looking
statements. The Private Securities Litigation Reform Act of 1995 provides safe
harbor protections for forward-looking statements, which include statements
concerning plans, objectives, goals, strategies, future events or performance,
and underlying assumptions and other statements, which are other than statements
of historical facts. Words such as "believe", "anticipate", "intends",
"estimate", "forecast", "project", "plan", "potential", "may", "should",
"expect", "pending" and similar expressions identify forward-looking statements.
The forward-looking statements in this communication are based upon various
assumptions. Although we believe that these assumptions were reasonable when
made, because these assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible to predict and
are beyond our control, we cannot assure you that we will achieve or accomplish
these expectations, beliefs or projections. The information set forth herein
speaks only as of the date hereof, and we disclaim any intention or obligation
to update any forward-looking statements as a result of developments occurring
after the date of this communication. In addition to these important factors and
matters discussed elsewhere herein, important factors that, in our view, could
cause actual results to differ materially from those discussed in the forward-
looking statements include DHT's failure to accept Frontline's proposal and
enter into a definitive agreement to effect the transaction, fluctuations in the
value of Frontline common shares issued in connection with the proposed
acquisition, the strength of world economies, fluctuations in currencies and
interest rates, general market conditions, including fluctuations in charter
hire rates and vessel values, changes in demand in the dry bulk market, changes
in our operating expenses, including bunker prices, drydocking and insurance
costs, the market for our vessels, availability of financing and refinancing,
changes in governmental rules and regulations or actions taken by regulatory
authorities, potential liability from pending or future litigation, general
domestic and international political conditions, potential disruption of
shipping routes due to accidents, political events or acts by terrorists, and
other important factors described from time to time in the reports filed by the
Frontline with the Securities and Exchange Commission.
This information is subject to the disclosure requirements of section 5-12 of
the Norwegian Securities Trading Act.
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Frontline Ltd. via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 25.04.2017 - 23:06 Uhr
Sprache: Deutsch
News-ID 538307
Anzahl Zeichen: 12309
contact information:
Town:
Hamilton
Kategorie:
Business News
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