OCM Njord, which is controlled by Brookfield, is planning to completely exit Torm by selling its remaining 6.17% shares. This move signifies the end of an ownership position that dates back to 2015 and the restructuring of Torm.
Details of the Share Sale
Torm announced that Njord has initiated a secondary public offering for 6,329,874 of its Class A shares. In this offering, Torm has not issued any shares and will not receive any proceeds from this transaction. JP Morgan will act as the sole underwriter for this offering. The sale is subject to market conditions, and no specific price has been announced.
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Changes in Ownership Structure
According to Torm's prospectus submitted to the U.S. Securities and Exchange Commission, if the entire block of shares is sold, Njord will have no shares in Torm. The share price of Torm on the Nasdaq was $41.05 on October 5, and the value of Njord's shares is estimated at around $260 million, although this price does not necessarily reflect the final value of the offering.
This sale is seen as a rapid retreat by Torm's largest former shareholder. Njord held 19.86% of Torm's shares in early July, but by September 28, this stake had decreased to 6.33 million shares, equivalent to 6.17%. Meanwhile, Hafnia, backed by BW Group, is increasing its stake in Torm and is now the largest shareholder of the company with 20,356,061 shares.
Potential Implications for Torm
SEB analysts believe that this sale will effectively mark the end of Oaktree's presence in Torm. They stated, "The completion of this exit will result in Hafnia being recognized as the dominant shareholder with a stake close to 20%." SEB also believes that a NAV-for-NAV merger between Hafnia and Torm is the most likely outcome of these changes.
While the ownership structure is changing, Torm continues to invest in its fleet. The company has announced in its stock reports that it has activated options for two new MR vessel constructions at the end of the third quarter, increasing its total number of new vessels to eight. These two new vessels are expected to be delivered in 2030, while the six initial vessels will be delivered in 2029.
Torm currently controls and operates 95 product tankers, and these ownership changes signify significant developments in the management and strategic structure of the company.
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