Hafnia Limited has entered into a share purchase agreement to acquire all outstanding shares in Chemical Tankers Inc, thereby taking over control of CTI’s fleet of 32 modern and fuel-efficient IMO II product/chemical tankers -the “CTI fleet”.

The CTI fleet consists exclusively of high specification ECO design vessels, constructed at leading shipyards, and is comprised of the following:

• 6 x MR (49,000 dwt) IMO II coated tankers built in Korea between 2015 and 2016
• 18 x Handy (38,000 dwt) IMO II coated tankers built in Korea between 2015 and 2016
• 8 x Intermediate (25,000 dwt) IMO II Stainless Steel tankers built in Japan between 2016
  and 2017

In exchange for all outstanding shares in CTI, CTI’s shareholders will receive shares in Hafnia representing 21.5% of the outstanding shares in the combined entity. The Consideration has been determined through a NAV for NAV framework, based on broker values and Q1 2021 balance sheets adjusted for other assets and liabilities within each business. Following the Transaction, and based on the current shareholding in CTI, CTI’s major shareholder, funds managed by Oaktree Capital Management, L.P., will hold 20.4% of the shares in the combined entity.

Hafnia has long been an advocate of consolidation. The Transaction underscores Hafnia’s commitment to grow its platform to maximise stakeholder value. Consolidation enables Hafnia to achieve improved earnings capability through the shipping cycle. Most importantly, the Transaction will complement Hafnia’s existing commercial activities in the Handy and MR segments whilst enabling enhanced trading flexibility through the ability to carry both clean petroleum products and chemicals, limiting ballast time by optimising triangulation and offering material cost synergies.

“The addition of the CTI fleet will help enhance our resilience in the face of volatile markets and create a more sustainable and future-proof transportation business that will include the ability to transport methanol, in addition to many other cargoes. I am grateful to Oaktree and the deal teams on both sides for their hard work towards the completion of the Transaction.” said Hafnia CEO Mikael Skov.

For CTI’s shareholders, the Transaction represents an opportunity to enhance its returns through access to greater economies of scale, lower cost of debt and upside exposure to a recovering product tanker market.

“This merger is the culmination of a thorough strategic process. It will allow CTI shareholders to benefit from the scale and commercial capabilities of Hafnia, while enabling Hafnia to expand its platform with a sizeable and young ECO design IMO II product/chemical tanker fleet. The addition of the CTI fleet brings with it new trading capabilities which, combined with Hafnia’s existing fleet and platform, will enhance the combined group earnings generation. We believe we’ve identified a best-in-class partner in Hafnia and are excited to embark on a promising journey alongside the BW Group and other Hafnia shareholders.” said Guillaume Bayol, Managing Director at Oaktree.

The Transaction remains subject to consent or waivers from some of CTI’s existing financiers, and Hafnia expects the Transaction to close before the 1st of February 2022. Following the Transaction, Hafnia will operate a fleet of 233 product and chemical tankers, making it the world’s largest operator in the product and chemical tanker segment. Its owned and chartered-in fleet will grow to 133 product and chemical tankers ranging in size from 25,000 dwt to 115,000 dwt. The Transaction will reduce the average age of Hafnia’s fleet to 7 years and increase the proportion of ECO ships in the Hafnia fleet.

This Transaction marks a significant milestone on Hafnia’s journey towards more sustainable shipping, contributing to ongoing efforts to modernise the fleet and introduce operational efficiencies resulting in improved environmental performance. The Company continues to be on track to achieve the IMO’s 2030 goal of a 40% reduction in carbon intensity by 2028.

The Company has retained Gorrissen Federspiel and Advokatfirmaet Thommessen as legal advisors, while CTI has retained Fearnley Securities and PJT Partners as financial advisors, and Linklaters LLC and Advokatfirmaet Wiersholm as legal advisors in connection with the Transaction.

Stolt-Nielsen Limited announced that Stolt Tankers B.V. has agreed to acquire five chemical tankers from Chemical Transportation Group for trading in the Stolt Tankers Joint Service.

The five ships, which are 26,000 dwt and with stainless steel cargo sections, were built in China in 2016 and 2017.  The purchase of each ship is expected to close between December 2020 and February 2021. Further terms of the transaction were not disclosed.

Commenting on the purchase, Stolt Tankers President, Lucas Vos, said

“This acquisition is an excellent opportunity for Stolt Tankers to replace ships being retired in the next few years, lowering our fleet age profile with competitively priced ships that can trade in any of our deep-sea lanes. Newer, fuel-efficient ships help us reduce our carbon footprint while buying existing tonnage means capacity is not added to a market that doesn’t need it.  In a cyclical industry like ours, buying the right ships at the right price is the path to financial sustainability.  In the end, Stolt Tankers’ customers are the real winners in this deal, as these ships will support our proven platform that provides a high quality, reliable and flexible service offering.”

Logistics service provider H.Essers announces the acquisition of the Norwegian-French company Tank Management, more than two years after acquiring tank container specialist Huktra. Tank Management specialises in multimodal transport services of liquid chemicals. With branches in Oslo, Le Havre, Milan and Rotterdam, their geographic coverage complements Huktra’s European presence. The further development of multimodal liquid bulk transport fits in H.Essers’ strategy of delivering integrated and sustainable logistics solutions to the hazardous chemical goods industry.

The Tank Management family business was founded in Oslo in 2006 and has evolved into a European specialist in the temperature-controlled transport of liquid loads, specifically for the chemical and food industries. The transport is mainly organised by rail, apart from short sea and road. The company is a multimodal player, with offices in Oslo, Le Havre, Milan and Rotterdam.
Tank Management has a turnover of 40 million euros, with 35 employees.  Its fleet consists of 800 modern ISO tanks capable of transporting liquids at different temperatures with a range going from -10° to +120°C. As with Huktra, all units are equipped with real-time track & trace. The temperature inside Tank Management’s fleet can be remotely monitored and controlled.

Strategic investment

The development of liquid chemical bulk transport is part of the long-term strategic plan of logistics service provider H.Essers. The company provides integrated logistics solutions to the chemical hazardous goods industry. This is a market segment with complex logistical challenges, stringent regulations and specific operating conditions (such as temperature control, safety and environment). H.Essers is concentrating increasingly on synchromodality: i.e. intelligently combining various modes of transport.

Huktra, a family business based in Zeebrugge and specialising in multimodal transport of liquid chemicals, was acquired at the beginning of 2018. This solid basis is now substantially further developed with the acquisition of Tank Management.

Geographical expansion

With this acquisition, H.Essers is greatly expanding the geographical footprint for liquid chemical logistics. Huktra already had branches in Belgium, the United Kingdom, Spain, Italy and Romania. The takeover of Tank Management has added France, the Netherlands and Scandinavia to the list.

With these additional regions, the service area is also being expanded. The multimodal transport range for liquid chemicals now extends throughout Europe, from Gibraltar to Moermansk, from Ireland to Urals, and beyond.

Portfolio expansion

H.Essers and Tank Management have joined forces, not only to expand the geographical scope of this specific logistics service, but also to enlarge the service portfolio. Tank Management is an innovative company developing customised supply chain solutions for the customers.

With this takeover, there will be an even stronger focus on temperature controlled liquids transport for the chemical industry. On top of this, Tank Management provides heated and cooled transport of liquid pharma goods and food products.

Joining forces

In H.Essers, Tank Management has found the partner to guide its operations into the next growth phase. “After the substantial growth Tank Management has recorded in recent years, it is now time for the next step,” is said by the families Nordbo & Philippe, the owners of the Norwegian-French company. “Thanks to the acquisition by a strong industrial player such as H.Essers, Tank Management will continue to excel in service, to grow and to expand its expertise in the coming years.”

H.Essers’ CEO, Gert Bervoets, also has strong confidence in the future. “The acquisition of Tank Management fits into our strategy of sustainable development of synchromodality within the chemical segment. It enables us to offer our customers a new way of managing transport flows, which are not only more efficient but, thanks to this approach, also more sustainable. It’s a win-win situation for all parties: customers, logistics service providers and our community”.

“Tank Management is a family business that shares our values”, Gert Bervoets continues. “As is the case in our company, safety and quality are paramount. As an example, material and equipment are renewed with a high frequency, to ensure that the operations meet the most stringent standards and strictest requirements. We are very much looking forward to welcoming our new colleagues into the warm-hearted H.Essers family and to shaping our future together”.

Industry of 100 million and 2,000 ISO tanks

The takeover was completed at the beginning of July. The current Tank Management directors will remain on board, as was the case with the Huktra takeover. The focus in the first phase is on the integration and consolidation towards one entity, specifically for conditioned liquids transport for the chemical industry. This entity represents a turnover of 100 million euros and a fleet of 2.000 ISO tanks.