Fresh off a $980m acquisition of one fleet, size-hungry Euronav already appears to be stalking more VLCCs under the control of bankrupt US owner Overseas Shipholding Group (OSG), sources tell TradeWinds this week.

Others who have also looked into the OSG fleet include Peter Georgiopoulos and his General Maritime Corp (Genmar), potentially setting the stage for a rematch of the duel that saw Euronav snatch Maersk Tankers’VLCCs after months of pursuit by the rival New Yorkers.

While the Belgian owner has the firepower to get it done, a purchase of OSG’s 10 VLCCs entails more complications than its rapid swoop for Maersk’s 15 units, market sources suggest.

For starters, OSG remains in Chapter 11 bankruptcy reorganisation in the US. Any major sale of assets would require court approval and could trigger an auction process unless parties can show why it would not be in OSG’s best interests.

The fleet is also older. Where Maersk’s tonnage averaged four years, OSG has two VLCCs built in 1996 and 1997, and five more built between 2000 and 2003.

But three units delivered between 2010 and 2012 from Dalian Shipbuilding have more appeal. Those are indeed the vessels that interest Euronav most, as they are sisters to tankers already in its fleet. But it could be a buyer for all but the 1990s-built ships, sources indicate.

After a move in the market to scrap even 15-year-old VLCCs, sentiment may be changing towards middle-aged tonnage, a tanker-market source said this week.



OSG fleet has more years

“Compared to Maersk, the OSG fleet has a little hair on it because of the age profile. But that’s not as big a factor today as it might have been three months ago,” he said.

“It is clear that Euronav would like to do another deal and OSG might make sense for them if they can get approval from the bankruptcy court. It makes more sense now because of what’s happening with VLCC prices.”

When a clutch of owners showed renewed interest in ordering VLCCs late last year, some like DHT Maritime were able to secure units for about $93m, he notes.

DHT has since received offers of $100m for the options at Hyundai Heavy Industries, he says, and it would be difficult to touch a premium newbuilding at the yard for less than that.

“So naturally, when newbulding prices escalate, secondhand values are going to follow,” said the source. “A 10-year-old VLCC is going to be interesting again, where a few months ago ships that were seven, eight, nine years old weren’t drawing much interest.”

A second tanker source agrees but attributes the trend to a recent surge in VLCC spot rates that reminds of better times.

“That volatility in rates has put life back into the market — it’s piqued a lot of people’s interest,” he said.



Deal could be likely

Meanwhile, a leading tanker owner tells TradeWinds it would not surprise him if Euronav were to take the OSG ships and seal its second fleet deal in quick succession.

He notes the OSG VLCCs already trade in the same Tankers International pool as the Euronav vessels. The two owners also have a joint venture with their respective ultra-large crude carriers (ULCCs).

With Marc Saverys and Peter Livanos behind Euronav, he says getting support for a deal from the capital markets would not be a problem.

“The two families behind Euronav are both super blue-chip names,” he said. “They can do whatever they want.”

Euronav has set its sights on a listing on the New York Stock Exchange this year, meaning a potential return to the bourse for the OSG fleet should a deal be completed.

The presence of the OSG vessels under the Euronav umbrella would not pose a problem for Euronav, the owner believes. “Investors are pragmatic,” he said.

As for the potential seller, OSG announced earlier this month that it will put its international fleet under the technical management of V.Ships and run it commercially through pools.

The change likely will cost hundreds of jobs and is viewed as a signal that OSG is prepared to liquidate its international fleet by vessel class and emerge from Chapter 11 as a US-flag operator.

Euronav has dramatically bolstered its financial position in the past few months. A key step was the $150m purchase of preferred shares by private-equity firms York Capital and GoldenTree Asset Management in early December.

Those investors then joined a pack of institutions who supported Euronav’s Maersk play, including some who switched over from backing Georgiopoulos’ Genmar in its attempt to seal the deal.