Taylor Maritime Investments Limited (TMI) said it has agreed to buy Grindrod Shipping Holdings Limited for a total price of $506mln.
The deal, facilitated through TMI’s subsidiary, Good Falkirk, values each share in Grindrod at $26.
The transaction is structured as a voluntary general offer, consisting of a cash purchase price of $21 per share to be paid by TMI for each share tendered in conjunction with a special cash dividend from Grindrod of $5 per share to its existing shareholders.
The enlarged group is expected to achieve enhanced realised revenue and cost unit economics that are not available to either TMI or Grindrod on a standalone basis, TMI said in a statement.
“TMI believes complementary fleets have the potential to generate defensive earnings and sustainable dividends, improving average vessel age and carbon intensity,” the company added.
Grindrod Shipping owns and operates a diversified fleet of owned and long-term and short-term chartered-in dry bulk vessels. The dry bulk business, which operates under the brand Island View Shipping (IVS), includes a core fleet of 15 handy size and 16 supramax/ultramax vessels, of which 25 are owned.
TMI, which already holds around 4.93mln shares in Grindrod, corresponding to a 26% stake, currently has 27 vessels in its portfolio in the handy size and supramax segment.
The company noted that the combination would enable the enlarged group’s chartering and technical management functions to realise additional value through the enhanced scale and utilisation of the combined fleet and charter book.