DHT has announced that the legal action filed by rival tanker owner Frontline has been dismissed.
The action in the High Court of the Republic of the Marshall Islands challenged DHT's deal with BW Group designed to fend of a Frontline takeover. Frontline is now precluded from bringing similar claims against DHT, its directors and BW Group in any other court. Under Marshall Islands' law, the dismissal also constitutes a ruling on the merits in favor of DHT.
"We are very pleased with the dismissal," said Erik Lind, Chairman of DHT's Board of Directors. "We have consistently stated, both in court and to our shareholders, that Frontline's claims are without merit. Two courts have now agreed with us, and we welcome the dismissal as an appropriate end to the matter."
The High Court of the Marshall Islands agreed to hear Frontline’s request for a preliminary injunction against DHT on May 17, 2017. However, it denied the company’s request for a temporary restraining order. Frontline was seeking an order requiring DHT to set aside its poison pill and what it sees as improper takeover defenses.
Billionaire President of Frontline John Fredriksen had been trying to build the world’s largest public tanker company, having made a fifth offer for DHT. Frontline currently owns 14.5 percent of DHT, but DHT struck a deal with BW Group to fend of the acquisition.
DHT struck a tankers-for-shares deal with BW Group in March, making BW Group DHT's biggest shareholder, with a stake of over 30 percent. Frontline then sought to stop the deal in the U.S. courts but the New York County Supreme Court said on April 19 it had no jurisdiction over DHT, which is incorporated in the Marshall Islands.
In April, Frontline approached DHT with a proposal that include ships already delivered and yet to be delivered as a result of the BW Group deal. The offer would be effected at an exchange ratio of 0.8 Frontline shares for each DHT common share. Frontline had given DHT 24 hours to consider the deal.
Cravath, Swaine & Moore LLP is serving as legal counsel to DHT.