Product tanker giant Hafnia will take a headline figure of $230m from its pre-placement issue of shares on Oslo’s Axess exchange, accepting a one-third reduction from its original target goal of $345m.
Hafnia’s announcement today of 83.1m shares sold at a price of NOK 25.45 ($2.79) confirms the company’s Monday disclosure that it would be forced to scale back expectations for the deal across the board.
Rather than selling $125m in new shares, it is selling $75m.
Rather than selling $175m in shares already held by insider private equity backers, it is selling $125m.
And rather than sell $25m worth of shares held by strategic partner and largest shareholder the BW Group, that entity has done an about-face and is now purchasing $50m worth of stock.
The sale price, too, was a compromise as the original range had been set at NOK 26.20 to NOK 30.90 per share.
An over-allotment option of shares to the deal’s underwriting banks has similarly been reduced to $30m from $45m.
Despite all the reductions, Hafnia put a positive face on today’s announcement, saying it had “attracted significant interest from a number of high-quality investors both internationally and in the Nordics.”
It added that the private placement “was well subscribed and more than 130 investors were allocated shares.”
Shares are expected to transfer from the Oslo over-the-counter (OTC) exchange — a market for unlisted shares — to the Oslo Stock Exchange’s Axess market on Friday.
This is the senior listing Mikael Skov-led Hafnia long has coveted, although the company originally had set sights on a New York IPO. It carried out a quiet filing with the US Securities and Exchange Commission (SEC) in 2014. That effort never came to market.
While it will find less market liquidity on the Axess, today’s disclosure shows that Hafnia has succeeded in diversifying its shareholder base because of the selloff by private equity.
Hafnia said PAG sold shares worth $42.4m, followed by Davidson Kempner with $18.7m, Oak Hill Capital with $14.8m, Global Natural Resources Investments (GNRI) with $14.5m, Blackstone with $13.3m, Tufton Oceanic with $11m and Tennenbaum Capital Partners with $10.2m.
PAG, Davidson Kempner and Oak Hill currently hold seats on Hafnia’s board of directors.
If underwriters fully exercise an over-allotment option to buy more shares, the group of selling shareholders will control 13.7% of the company following the deal.
PAG will hold 4.6%, followed by Davidson Kempner at 2%, Oak Hill and GNRI at 1.6% each, Blackstone at 1.5%, Tufton at 1.2% and Tennenbaum at 1.1%.
Hafnia would have further diversified its shareholding had BW been able to sell $25m of its holding as intended. Instead, it apparently needed to shore up the deal by purchasing $50m more, finance sources suggest.
That will take its holding to more than 242 million shares, or 65.4% of the company.
Shares sold in the offering represent 22.4% of the company, which will have a free float of 33.9% at the conclusion of the deal, Hafnia said.
Hafnia is one of the world’s largest operators and owners of product tankers. It operates 180 vessels in pools, of which 102 are owned or chartered in.
The operation grew when Hafnia and BW Tankers wrapped up a $2.3bn merger in January.
Hafnia on Monday blamed the reduced scale of the offering on “volatility in tanker stocks.”
The pre-listing placement is being led by Fearnley Securities, Pareto and SEB as bookrunners.
ABN AMRO Bank, Danske Bank (Norway) and Nordea Bank are acting as co-managers.
