Knightsbridge Tankers Ltd merges with Ocean Group Limited for 61.5 million in shares.

Knightsbridge Tankers Ltd and Golden Ocean Group Limited announced that the two companies have entered into an agreement and plan of merger. Pursuant to which the two companies have agreed to merge, with Knightsbridge as the surviving legal entity.

The Combined Company will be renamed Golden Ocean Group Limited upon completion of the merger. As a result of the expected merger, the Combined Company would be the world’s leading dry bulk companies that has a modern fleet of 72 vessels, of which 36 are new buildings under construction.

The transaction is subject to approval by the shareholders of Golden Ocean and Knightsbridge in a separate special general meeting expected to be held in December 2014 or January 2015. The merger is also expected to close shortly thereafter. Definitive documents will be completed and customary closing conditions and regulatory approvals will be enforced.

Knightsbridge’s ordinary shares are listed on the NASDAQ Global Select Market (“NASDAQ”) and Golden Ocean’s ordinary shares are currently listed for on the Oslo Stock Exchange (the “OSE”) as well as the Singapore Stock Exchange. The Combined Company will apply for a secondary listing of its ordinary shares on the OSE. It will also push that after the merger its ordinary shares will be listed for trading on NASDAQ and the OSE. Golden Ocean shareholders at the time the merger is completed will receive shares in Knightsbridge. Golden Ocean will give the right to receive 0.13749 shares in Knightsbridge, and Knightsbridge will issue a total of 61.5 million shares to shareholders in Golden Ocean as merger consideration.

Mr. John Fredriksen, Mr. Gert-Jan van der Akker and Mrs. Kate Blankenship will be added to the Board of Directors of the Combined Company as a result of the merger. Mr. Ola Lorentzon will continue as Chairman of the Board for the Combined Company. Mr. Gert-Jan van der Akker is Senior Head of Region at Louis Dreyfus Commodities (“LDC”).

Golden Ocean’s current corporate management team and employees of which currently is the commercial manager of the Knightsbridge dry bulk fleet. Herman Billung, who is the principal executive officer of Golden Ocean, will act as the principal executive officer of the Combined Company, and Birgitte Ringstad Vartdal, who currently serves as the principal financial officer of Golden Ocean, will serve as the principal financial officer of the Combined Company.

Ola Lorentzon, Chairman and CEO of Knightsbridge, and Chairman of Golden Ocean Group Limited, John Fredriksen stated: “By combining Knightsbridge and Golden Ocean we seek to create a company with a unique fleet and strong balance sheet and build one of the world’s leading dry bulk shipping companies. With the current weakness in the dry bulk market, we believe there will be attractive consolidation opportunities going forward. Our ambition is to be a clear market leader both from a financial and operational perspective. Upon an expected recovery of the dry bulk market and as newbuilds are brought into the fleet, we believe the Combined Company will generate significant cash flow. The intention is to pay out excess cash as dividends in the Board’s discretion.”

After the merger is completed, the Combined Company expects to have a fleet of 46 Capesize vessels, 10 ice class Panamax vessels, 8 Kamsarmax vessels and 8 Supramax vessels, of which 36 are new buildings under construction. In addition the Combined Company expects to have a small number of leased vessels and one vessel owned through a joint venture. More details of the merger will be announced as meetings regarding the transaction commences in December 2014 or in January 2015.

Original article from Street Insider.

A.L.Mijares

About Knightsbridge Shipping Limited

Knightsbridge Shipping Limited was incorporated in Bermuda on September 18, 1996. It is an international tanker company and its primary business activity is the international seaborne transportation of crude oil.  Knightsbridge Shipping Limited stock market evolution:

http://www.marketwatch.com/investing/stock/vlccf

About Golden Ocean Group Limited

Golden Ocean Group is a Bermuda registered; Norway based dry bulk shipping company. The company was created as a demerged part of Frontline in 2004 and listed on the Oslo Stock Exchange. 40.3% of the company is indirectly owned by John Fredriksen, through Holding. The fleet consists of 24 owned vessels (20 under construction), 22 chartered vessels (7 with purchase options), 7 bare boat vessels (all with purchase options), 10 vessels under commercial management (8 ore-bulk-oil carrier, two capesizes under construction) and 9 sold up on yard delivery. 16 of these are capesize while 56 are panamax, of which 1 capesize and 8 panamaxes are sold when delivered from yard. Management of the fleet is carried out by the Norwegian company Golden Ocean Group Management AS led by Herman Billung. Golden Ocean Group Limited stock market evolution:

http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?ticker=GOGL:NO