Euronav has received qualified backing for its green shipping diversification strategy from Clarksons Securities.
The Saverys-controlled Belgian tanker owner is buying the family’s clean shipping operation CMB.Tech for $1.15bn, adding a fleet of low-carbon bulkers, container ships and offshore vessels.
Orders for 120 more ammonia and hydrogen-powered ships, including product tankers, are planned.
“This acquisition signifies Euronav’s entry into the clean technology sector, with CMB.Tech focusing on innovative solutions for marine transportation and fuels,” analysts led by Frode Morkedal said.
The investment bank believes the new company “offers an intriguing value proposition in terms of the future of shipping”.
In January, US investment bank Evercore ISI dropped coverage of Euronav on the basis that it no longer fitted within its framework for analysis of the tanker sector.
Evercore said the merger was part of a “de-emphasising” of the tanker business.
The shorter-than-usual Euronav fourth-quarter earnings call last week was notable for the lack of questions from any big US investment banks.
Euronav will be renamed CMB.Tech and reallocate cash flows from dividends towards growth initiatives, Clarksons Securities noted.
“These initiatives include investments in environmentally sustainable newbuilds and the expansion of CMB.Tech’s operations,” it added.
The Saverys’ shipping company Compagnie Maritime Belge, which has 53% of Euronav, is also expected to launch its mandatory offer for the rest of the stock at $17.86 per share this month.
Short-term value prospects limited
Morkedal’s analysts suggests a “sum of the parts” valuation of the combined entity of around $18.30 per share.
Euronav bosses are targeting a valuation uplift over time, they said.
“However, with the majority of the new fleet still under construction and other projects many years away, achieving an earnings valuation higher than the sum of the parts could be difficult before we see the full impact of the diversified earnings and cash flow,” they added.
The short-term valuation should closely mirror the current bid, they believe.
Clarksons Securities is maintaining a “neutral” rating on the shares.
