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Capital Product Partners LP (CPLP), the participating company Evangelos Marinakis and Diamond S Shipping Holdings (DSS), whose main shareholder is the private equity fund WL Ross & Co, founded in 2000 by the current secretary at the US trade, Wilbur Ross, entered into a merger agreement in a new scheme worth $ 1.65 billion,
Under this agreement, the CPLP will cease operations in the crude oil and tanker sector by donating 25 tanks, creating a new publicly traded company, which will then merge with DSS operations.
The merger creates one of the largest publicly traded tanker companies in the world. The transaction will be by exchange of shares. The CPLP will allocate 22 MR tankers and 3 Suezmax to the new system, while its shareholders will receive more than 10.7% of the value of the fleet, since the merger allows Diamond Shipping to be directly listed in stock Exchange. DSS recently attempted to enter the US stock market, but poor weather conditions in the rental market and low willingness to take the risk of the investing public led to the postponement of the public offering.
It is estimated that CPLP's shareholders control about 33% of the new entity and DSS shareholders the remaining 67%. They will receive a new DDS share for every 10,19149 CPLP shares they own today. In addition, DSS pays 23 million euros to CPLP shareholders, which represents a premium of 10.7% over the current value of the net badets (NAV) of the CPLP share.
The new company, Diamond S Shipping Inc., is expected to be listed on the New York Stock Exchange and will be headquartered in Greenwich, Connecticut. According to the announcement published by the capital product partners listed, the portfolio of Diamond S Shipping Inc. will include the combined tanker and capital product partnership products and DSS, totaling 68 tankers with an average duration of 7, 8 years.
Diamond S Shipping Inc.'s newly appointed Managing Director will be Craig Stevenson Jr, General Manager of DSS. Diamond S Shipping 's seven – member board of directors will include Nadim Qureshi (chairman), Hal Malone, Kate Blankenship, Gerasimos Kalogloratos and Gerasimos Ventouris and Stevenson and Bart Veldhuizen.
Capital Maritime & Trading, the private interests in the navigation sector of Evangelos Marinakis and the main shareholders of Capital Share Partners capital should represent around 5% of the new program. Capital Product Partners will remain a listed transport company that will retain control of ten modern container ships and one truck that will not be transferred to the new system. The transaction, subject to approval by the appropriate authorities, is expected to close in the first quarter of 2019.
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