Board Shakeup at Frontline as Euronav Merger Showdown Approaches

File image courtesy Frontline

Published May 3, 2022 11:23 PM by The Maritime Executive

Tanker giant Frontline is undergoing a boardroom shakeup as it moves towards a merger with Euronav. One independent director has stepped down, and two new directors with links to billionaire shipping mogul John Fredriksen have joined the board. 

Tor Svelland, CEO of investment company Svelland Capital, has resigned from the board after about 18 months of service. He is replaced by Ole B. Hjertaker and Steen Jakobsen, two executives at firms with ties to Fredriksen.

Hjertaker is the CEO of SFL Corporation, a dividend-focused shipowner listed on the NYSE. SFL has a diversified fleet of about 70 vessels, and Fredriksen - through a number of investment trusts - is its largest shareholder. His investment vehicles own about 19 percent of SFL's stock, according to the company's most recent filing. 

Jakobsen is the chief investment officer at Saxo Bank and serves as a director on the board of Flex LNG, an LNG carrier owner listed on the NYSE. The firm owns 13 South Korean-built LNG carriers, all less than five years old. Through an investment trust, Fredriksen owns about 46 percent of its stock. 

With Fredriksen's backing, Frontline is in negotiations to merge with Euronav, the world's second-largest tanker operator. The deal is opposed by the Saverys family, the owners of Compagnie Maritime Belge (CMB), who have accumulated about 16 percent of Euronav's stock in hopes of blocking the agreement.

For Euronav's annual shareholder meeting on May 19, CMB has proposed a slate of three new directors for Euronav's board, and it has submitted its own merger proposal. Euronav opposes CMB's bid and has asked shareholders to vote against it. 

If the Frontline-Euronav merger goes through, it will create the world's largest tanker owner, a single $4.2 billion company controlling about 10 percent of the world's VLCC and Suezmax fleets.