International Seaways Acquires Bruton's VLCC Fleet for $370 Million

International Seaways reached an agreement to acquire all of Bruton, the Norwegian VLCC owner backed by Tor Olav Trøim, in a transaction valued at approximately $370 million. The deal, announced on Friday, October 16, adds four 300,000-dwt supertankers to the fleet of the New York-based company led by Lois Zabrocky, in a transaction that went well beyond what was initially speculated in broker circles.

Days earlier, Bruton had launched a strategic review after the market speculated about a possible sale of two of its newbuildings, the Mount Frontier and the Mount Summit, under construction at the New Times shipyard. Brokers were citing figures above $200 million per vessel, well above the original shipyard cost, estimated by Bruton at around $117 million each.

Under the final structure, International Seaways secured agreements with shareholders representing 50.5% of Bruton, including Trøim's Drew Holdings and Koch Inc, to exchange their stakes for newly issued shares, with closing expected around October 20. The remaining shares will be acquired through a cash-and-stock merger, with an exchange ratio of 0.0519 Seaways shares for each Bruton share and cash payments of $6.3044 per share for minority shareholders; the company expects to issue close to 3.12 million new shares, equivalent to 96% of the total consideration.

The package includes the Mount Vision, a dual-fuel LNG vessel delivered in July and chartered at $95,000 per day for the first nine months before moving to an indexed structure, and its sister ship Mount Horizon, set for delivery next month and already fixed on a 12-to-15-month charter at $105,700 per day. The two remaining vessels, Mount Frontier and Mount Summit, scheduled for delivery in August and October 2027, come without charter coverage, as market rumors had anticipated.

The deal comes at a time of exceptional earnings for Seaways, which reported average spot earnings of about $68,000 per day in the third quarter, more than double the level a year earlier, and has already secured close to $180,000 per day for 37% of its projected revenue days for the fourth quarter. The company reported liquidity of approximately $965 million at the end of September and a preliminary net profit of between $340 million and $350 million for the third quarter. The transaction also reconnects Trøim with the family trusts of John Fredriksen, his former business partner, which hold a 13.54% stake in International Seaways.

Analysts at Clarksons Securities had anticipated that the deal would top $200 million per vessel when the first rumors surfaced on October 8, and an average of $201 million for the four vessels combined ended up confirming that projection, marking what was described as a new ceiling for VLCC resales.