Ardmore Shipping was once described by chief executive Anthony Gurnee as “the perennial candidate” in merger-and-acquisitions rumours.
So are those rumours going to spark up again, given Gurnee’s surprise retirement announcement?
With a fleet of 22 owned tankers and a market capitalisation of around $850m, Ardmore is the perfect size for such rumours, because it is midway between being a small shipowner and a big one with the scale necessary to be an industry consolidator.
But Gurnee’s departure — said to be the result of a “long-established” succession plan — does not in itself increase the likelihood of the Ireland-based owner coming into play, in the view of one veteran finance man.
“Not at all — I don’t think this changes anything,” Gurnee said when contacted by TradeWinds on Monday.
“This was long planned, as I understand it, and there is significant continuity here, and a deep bench. There’s no reason the board would wish to merge with anyone at this point. The stock is trading well and the company is well positioned.”
However long-laid the plans may have been inside Ardmore, his departure came as a surprise to much of the market on Monday as players began to sift through tea leaves for any further colour.
A comment regretted
Gurnee always has been a careful, deliberate and disciplined public speaker, but it was the CEO himself who told TradeWinds in 2018 that “regarding M&A, we are the perennial candidate in the rumour mill and I suppose that won’t change”.
During an interview in 2023 as Ardmore celebrated the fruits of a sustained bull market in product tankers, Gurnee admitted that was one he wished he could take back.
“I really regret saying that. We’re actually really not,” he said in relation to being a perpetual M&A target.
“We’ve looked at a lot of M&A for the last five years and the conclusion has always been that the complexity, the cross-currents, the conflicts of interest that came with the opportunities just were not worth it.”
Asked whether that applied to a possible role as a consolidator too, he brushed that off with a message focused on Ardmore alone: “We are a high-performance company that’s performing very well relative to our peers and we think we’ve got a long way ahead of us.”
Interest remains
That does not mean the company wouldn’t have suitors if the new leadership were to decide on a different course.
Oslo and New York-listed Hafnia Tankers is one bigger shipowner known to have checked out an Ardmore acquisition in the past few years, tanker market sources told TradeWinds.
It is also thought that Ardmore’s fleet could be a good fit for listed owners Torm of Denmark and International Seaways of the US, which has been working to get younger within its ageing fleet of MRs.
Hafnia boasts an owned fleet of nearly 120 tankers and a market capitalisation of just over $4bn.
Torm has an owned fleet of about 90 tankers and a market cap near $3.6bn.
International Seaways owns a diversified fleet of 81 tankers, including 37 MRs. Its market cap is nearly $3bn.
The initial shareholder reaction to Gurnee’s departure was not positive on Monday: Ardmore shares slid more than 5% to $20.36 on the New York Stock Exchange.
Peer companies also fell in Monday trading, but only about half as much in percentage terms.
