Gas Shippers Navigator Holdings, Ultragas ApS to Merge Fleets and Businesses.
MANews-(C)2009-2021
UK-based liquefied gas carrier operator Navigator Holdings Ltd (NYSE: NVGS) has signed a non-binding letter of intent with Chile-based gas shipper Naviera Ultranav Limitada to merge Ultragas ApS' fleet and business activities with Navigator, the company said.
The transaction would unite two gas shipping companies with similar culture and mindset and is expected to enhance Navigator's safe, reliable, energy and environmentally efficient, marine transport services.
The combined fleet would total 56 vessels, which would enhance Navigator's capability to provide flexibility and support to its customers.
It is expected that Navigator would issue approximately 21.2m new shares of its common stock to Ultranav, and assume Ultragas' net debt of approximately USD 197m, as well as its net working capital.
The combined entity would have an aggregate net asset value of approximately USD 1.3bn, based primarily upon desktop appraisals by maritime brokers.
After giving effect to the proposed issuance of its new shares of common stock to Ultranav, Navigator is expected to have a total of approximately 77.1 m shares of common stock outstanding, of which Ultranav would own approximately 27.5% and BW Group would own approximately 28.4%.
In addition, pursuant to an earlier agreement dated and disclosed December 2020, we will also welcome to our Board, a second BW Group nominee, Andreas Sohmen-Pao, chairman of BW Group Ltd.
The transaction is expected to be accretive compared to Navigator's standalone budgets, in terms of anticipated revenue, EBITDA and EPS.
Ultragas' fleet of seven modern 22,000 cbm semi-refrigerated vessels, five 12,000 cbm ethylene vessels and six gas carriers in the 3,770-9,000 cbm range will broaden the service offering for the combined fleet. With the addition of these vessels, Navigator will be better positioned to engage new clients and new markets through increased coverage and geographical reach.
The combination would have reduced the average age of Navigator's fleet to nine years, as at December 31, 2020.
The combined fleet and increased scale is expected to provide significant cost synergies and efficiencies throughout the business.
Navigator expects to maintain financial strength and a strong balance sheet.
The combination would add another major shareholder with long-standing experience in the maritime industry, which Navigator believes will be to the benefit of its shareholders.
The transaction is subject to...
To continue reading
Request your trial