John Fredriksen is about to launch a mandatory offer to buy all the shares he does not already own in Norwegian VLGC owner Avance Gas.
The offer, which is due to be submitted at some point next month, was automatically triggered after Fredriksen’s private outfit Hemen Holding increased its stake in Avance.
According to a regulatory filing on the Oslo Stock Exchange on Friday, Hemen bought 127,207 Avance shares to increase its shareholding in the company to 32.78%.
Combined with a separate holding through Frontline, Hemen owns a 33.35% stake in Avance and is now obliged “to make a mandatory offer pursuant to section 6-1 of the Norwegian Securities Trading Act”, according to the filing.
“Hemen intends to put forward a mandatory offer to acquire all shares not already held by it within the four-weeks deadline stipulated by section 6-10 (1) of the Norwegian Securities Trading Act,” the filing said.
The highest price that Hemen has paid for Avance stock over the past six months was NOK 43 ($4.74) per share, the filing shows.
"We believe there could be potential for more," analysts at DNB said in a flash note to investors.
"Taking the company private could realign value with the physical market, as stock markets have historically priced deep discounts into the LPG stocks."
Hemen is a Cyprus company indirectly controlled by trusts established by Fredriksen for the benefit of his immediate family.
Avance is an Oslo-listed shipowner that controls a modern fleet of 13 VLGCs.
The shipowner also has an orderbook of six dual-fuel newbuildings scheduled for delivery between the end of 2021 and 2023.
According to its website, the company traces its roots in the creation of Stolt-Nielsen Gas in 2007 and completed its previous newbuilding programme in 2015.
Taking full control of the outfit would mark the culmination Fredriksen's moves to tighten his grip on the shipowner.
In April, for example, Hemen hiked its holding to 29.1% from 25% by snapping up shares in a stock sale.
On Thursday, Avance presented a positive market outlook for its VLGCs, despite a shrinking second-quarter profit.
