FRO - Frontline Update on a Possible Business Combination with DHT Holdings, Inc.
February 09 2017 - 8:30AM
Frontline Ltd. (the "Company" or "Frontline")
(NYSE: FRO) acknowledges that the Board of Directors of DHT
Holdings Inc. ("DHT") (NYSE: DHT) has publicly rejected the
Company's proposal to effectuate a business combination between the
Company and DHT.
Robert Hvide Macleod, Frontline's Chief Executive
Officer, said, "We believe that our offer to DHT shareholders is
highly compelling since it provides a meaningful upfront premium,
while also giving all shareholders the opportunity to realize the
full benefit of the significant synergies and attractive upside
that a combined company would create."
The proposed offer made by Frontline, which
represented a 19% premium to the share price of DHT as of closing
of January 27th, 2017 and 31% premium to the 60 day volume weighted
average price, was stated to be "wholly inadequate" by the Board of
Directors of DHT, and not in the best interests of DHT's
shareholders. Rather than engaging in discussions with Frontline
with the aim of achieving the highest possible offer to create
maximum shareholder value, the Board of Directors of DHT adopted a
one-year shareholder rights plan and has since continued to refuse
to enter into any discussions.
DHT also stated that the proposed offer
represented an opportunistic attempt to acquire DHT at a low point
in the cycle, which Frontline finds irrelevant given the all-share
offer.
We believe the combination of Frontline and DHT
would be better positioned to participate in a market recovery than
either company would on a stand-alone basis. The combined company
would be expected to create the largest public tanker company by
fleet size, market capitalization and trading liquidity. DHT
shareholders would be expected to benefit from a substantially
lower G&A cost per vessel and capitalize on synergy values.
Finally, a superior access to debt and equity capital markets would
be expected to enhance free cash flow generation further,
maximizing value for both sets of shareholders.
As previously reported, Frontline, together with
its affiliates, holds 15,356,009 shares of DHT, representing
approximately 16.4% of DHT's outstanding common stock based upon
93,433,804 common shares outstanding.
February 9, 2017
The Board of Directors
Frontline Ltd.
Hamilton, Bermuda
Questions should be directed to:
Robert Hvide Macleod: Chief Executive Officer,
Frontline Management AS
+47 23 11 40 00 / +47 93 20 21 22 /
robert.macleod@frontmgt.no
Inger M. Klemp: Chief Financial Officer, Frontline
Management AS
+47 23 11 40 00 / +47 95 75 67 27 /
inger.klemp@frontmgt.no
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 possible 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").
There can be no assurance that any additional plan for a possible
business combination with DHT or other transaction will be
developed or as to the terms or the timing of any such plan or
transaction. Any transaction would be subject to, among other
things, satisfactory due diligence review and negotiation and
execution of mutually satisfactory definitive transaction
documentation. 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 failure to consummate the proposed business 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 tanker 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 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
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