Odfjell exits gas carrier business

Odfjell Gas Shipowning AS, part of Norwegian shipping and tank terminal company Odfjell SE, has entered into a transaction agreement with Singapore-based ship owner and operator BW Epic Kosan Ltd. (BWEK) for the sale of two LPG/ethylene carriers.

The vessels in question are Bow Guardian and Bow Gallant, both built in South Korea in 2008.

As explained, the purchase price will be settled partly in cash, to be used for the full repayment of mortgaged loans on the vessels, and partly by the issuance of 6,889,611 freely transferable shares in BWEK. Following the transaction, Odfjell will own 4.3% of the shares in BWEK.

The transaction is expected to close prior to October 31, 2021.

Pursuant to the transaction agreement, an additional consideration of up to 362,611 shares in BWEK can be received subject to certain conditions being fulfilled during an 18-month period from the delivery of the vessels, Odfjell said.

“The transaction concludes Odfjell SE’s exit from the gas segment and the shareholding in BWEK will be considered as a non-strategic financial investment,” according to Odfjell.

The gas carrier segment was a joint venture operating the two LPG/ethylene carriers. In March 2021, Odfjell SE purchased the 50% shares in Odfjell Gas AS from its joint venture partners, and became owner of 100% of the shares in Odfjell Gas AS. The purchase price was $16.7 million.

 The Odfjell fleet comprises about 90 ships, while the tank terminal division consists of five tank terminals and is part of a network of another eleven tank terminals partly owned by related parties.