International Seaways has signed an agreement to acquire Bruton, a tanker company backed by Tor Olav Trøim, for approximately $370 million. This agreement, announced on Friday, includes the purchase of the entire fleet of four super tanker ships from Bruton and is significantly larger than the sale of two new ships that were linked to an American owner last week.
Details of the Agreement
International Seaways has reached agreements with shareholders representing 50.5% of Bruton, including Drew Holdings and Koch Inc, to exchange their shares for new shares in the American company. The exchange rate for each Bruton share is set at 0.0519 shares of International Seaways, and the deal is expected to close around October 20. The remaining shares will be acquired through a merger, and Seaways expects to issue approximately 3.12 million new shares, representing 96% of the total amount. Smaller Bruton shareholders will also receive a cash payment of $6.3044 per share.
Fleet Expansion and Revenue Generation
This agreement adds four VLCC tankers with a capacity of 300,000 deadweight tons to the Seaways fleet, including a dual-fuel LNG vessel named Mount Vision, which was commissioned in July, and its sister ship Mount Horizon, which is expected to be delivered next month from a new shipbuilding facility in China. The other two ships, Mount Frontier and Mount Summit, will join the fleet in August and October 2027, respectively.
The first two ships have strong charter coverage. Mount Vision has signed a 3+1+1 year contract with a trading house that will generate $95,000 per day in the first nine months. Mount Horizon has been set at a rate of $105,700 per day for a period of 12 to 15 months.
This agreement is based on a very strong revenue backdrop. Alongside the announcement of this agreement, International Seaways has projected net income for the third quarter of $340 to $350 million, which includes a profit of approximately $50 million from the sale of a Suezmax ship. The company had liquidity of nearly $965 million at the end of September.
The agreement is associated with well-known names in Norwegian maritime transport. According to the latest regulatory filings in the United States, family trusts established by John Fredriksen, a former business partner of Trøim, hold 13.54% of the shares of International Seaways. Bruton has also unanimously approved this agreement, and a shareholder vote is expected to take place around October 30.
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