MSC Mediterranean Shipping Company has offered to buy Gram Car Carriers for NOK 7.6bn ($700m).
Gram Car Carriers has reached an agreement with MSC subsidiary SAS Shipping Agencies Services for an offer to acquire all issued and outstanding shares.
A cash consideration of NOK 263.69 will be offered per share.
According to Clarksons, Gram is the 16th-largest car carrier owner in the world in capacity terms, with a fleet of 18 vessels on the water of a combined 222,883 cbm.
Oslo-listed Wallenius Wilhelmsen leads the way with a fleet of 74 ships on the water and eight newbuildings on order with a capacity of 1.96m cbm.
MSC’s main objective is to expand its presence in the market for car transportation at sea, according to a statement.
“This market presents business elements that are familiar to the MSC Group, which already has two car carrier ships and transports regularly, on its containerised vessels, an important volume of cars (in containers),” the companies said.
GCC, “with its current fleet of 18 owned car transportation vessels and its management and operational know-how, will be of great value to the MSC Group going forward, while, at the same time, the contemplated transaction will enable” GCC and its customers to benefit from MSC’s global logistics expertise and footprint.
Pareto analyst Eirik Haavaldsen said the takeover was not entirely unexpected, as several liner companies have become more active in car carriers.
“MSC obviously has a good knowledge of the extensive Chinese car exports that currently are handled via containers — so positive market read-through (Hoegh Autoliners/Wallenius Wilhelmsen),” he said.
“In sum, expect this to go through and positive to see such a blue-chip player like MSC getting firmly involved in car carriers.”
According to Pareto, the price is fair, and marginally above the broker’s target price of NOK 268.
GCC’s board unanimously resolved to recommend that shareholders accept the offer.
“Today’s voluntary offer by one of the world’s leading maritime groups is a validation of the unique position GCC has built as a leading car shipping tonnage provider and the long-term commitment put in by the entire team,” chairman Ivar Myklebust said.
“The board is satisfied that the offer represents a fair valuation of GCC, as is also reflected in the recommendation to shareholders to accept the offer.”
The board has received a fairness opinion from ABG Sundal Collier concluding that the offer price is fair, from a financial point of view.
GCC announced a first-quarter dividend of NOK 9 per share.
The offer price plus the dividend will result in total cash proceeds to shareholders of NOK 272.69 per share.
The total share proceeds represent a premium of 28.3% to the closing trading price on Tuesday in Oslo of NOK 212.5.
Shareholders, including members of the board and the executive management, who collectively own about 55.85% of issued and outstanding share capital, have undertaken to accept the offer, on certain terms and conditions.
The company’s largest shareholders (F Laeisz, AL Maritime Holding, Glenrinnes Farms, HM Gram Investment III and HM Gram Enterprises), which in aggregate hold about 54.54% of the shares, have given irrevocable undertakings to accept the offer.
The acceptance period will begin at the latest on 31 May and will remain open for at least 20 business days.
The offer is expected to be completed during the third quarter or at the latest in the fourth quarter.
The minimum acceptance level for the offer is 90% or more of the issued and outstanding share capital and voting rights.
GCC intends to keep the group’s operation under the same name and organisation and to continue delivering the same quality of service to customers on an uninterrupted basis.
MSC intends to delist GCC from Euronext Oslo upon completion of the offer and withdraw from trading on OTCQX Best Market in New York.
Fearnley Securities and Jefferies are acting as financial advisers and Wikborg Rein Advokatfirma is acting as legal adviser to GCC.
DNB Markets is acting as financial adviser and Advokatfirmaet Thommessen is acting as legal adviser to MSC.
MSC is led by Gianluigi Aponte, who according to Forbes is one of the 50 richest billionaires in the world.
Mainboard move
In December 2022, GCC completed a move up to the main Oslo Bors after its value jumped since listing in January that year.
The company described the move as an “important milestone” as it carried out a strategy of joining the top table of owners of modern vehicle carriers.
The private placement when it listed in Oslo raised $121m. The former Singapore corporate structure was replaced with one in Norway.
The month before, F Laeisz’s holding increased from 25.49% to 26.92% in a share deal. It later rose to 27.81%.
F Laeisz had earlier become the biggest shareholder with stock awarded as payment for two car carriers it sold to GCC as part of the private placement.
GCC was founded by Peter D Gram in 1982.
In March 2023, Hamburg’s shipowning Bunnemann family put more of its money into GCC.
An Oslo bourse filing showed the German clan bought a further 620,725 shares for NOK 94m in a block transaction.
The family’s AL Maritime Holding had a stake of 12.29% in GCC at that time, making it the second-biggest investor.
The Bunnemanns own container ship players Asiatic Lloyd in Singapore and Atlantic Lloyd in Hamburg, whose fleets consist of tonnage between 1,000 teu and 9,000 teu.
The companies are headed by Friedrich and Nicolaus Bunnemann, the latest generation.
Nicolaus Bunnemann sits on the GCC board, as does another director linked to AL Maritime, Clivia Breuel (nee Bunnemann).
AL Maritime put $12m into the $121m placement. It had a 10.17% stake previously.
