Frontline’s change of domicile to Cyprus takes effect ahead of proposed Euronav tie-up

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Frontline Ltd, the flagship tanker company of principal John Fredriksen, reports that it has completed the move of its domicile from Bermuda to Cyprus under the new corporate identity of Frontline plc, with the company’s assets, financial reporting structure and executive officers all remaining the same.

The move is a prelude to Frontline’s planned bid to take over fellow tanker giant Euronav of Belgium, creating a leading global independent oil tanker operator with a combined fleet of 146 large tankers, including a world-leading number of VLCC and Suezmax vessels; Frontline itself currently owns and operates 72 modern tankers: 23 VLCC, 29 Suezmax and 20 Aframax/LR2.

The merger plan was first unveiled the plan in April 2022, with the new entity to retain the Frontline name but be headed up by current Euronav CEO Hugo de Stoop. Progress has since been delayed by complexities surrounding Frontline’s redomiciliation to the EU, finally completed end-December, and a formal merger bid is now expected in Q1 2023. Euronav shareholder CMB, controlled by the Saverys family, has been fiercely opposing the move, however, arguing that it will not result in the claimed synergies in terms of costs savings and competitive advantage and proposing an alternative Euronav plan for diversification and a focus on decarbonisation.

In December it was reported that CMB had managed to increase its Euronav shareholding stake to the 25% necessary to block any full-blown merger but Frontline has said the two tanker companies will nevertheless proceed to run operations jointly under a ‘combination agreement’ they signed last summer.

In any event, Frontline’s move of domicile to the Republic of Cyprus represents a major boost in prestige for the Mediterranean island and its shipping capital Limassol, already home to the EU’s largest shipmanagement community and third largest flag (behind Malta and Greece). Norwegian-born Fredriksen, whose other business interests include offshore drilling, dry bulk and industrial fish farming, has long associations with the island and is a holder of Cypriot nationality.

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