Euronav Reaffirms Commitment To Combination Agreement with Frontline

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Euronav NV acknowledges the receipt from CMB NV (“CMB”) of a letter to our Supervisory Board asking it to terminate the Combination Agreement with Frontline Ltd. (“Frontline”), following the publication of a 13D filing in relation to the recent increase of its holdings in Euronav. The fact that this development could take place, has always been planned for in the proposed combination.

The exchange offer, which is expected to be launched in the first quarter of 2023, aims at combining the two companies so that they can act as one group where Frontline will be the parent and Euronav a majority-controlled subsidiary. This exchange offer is independent from any merger.

This new Frontline will:

  • Become a leading global independent tanker operator with scale benefits;
  • Bring together complementary platforms to optimize operations in a competitive environment;
  • Combine best in class leadership from two highly experienced management teams;
  • Drive leadership in sustainable shipping, aspiring to the highest ESG standards in the industry; and
  • Become a “must-have” stock in the crude tanker market.

In order to successfully complete the exchange offer, Frontline will need to accumulate a minimum of 50% +1 share of the current outstanding capital. Once Frontline takes control of Euronav, the two companies will be acting as one group.

Under Belgian law, whilst a minority shareholding of more than 25% could potentially be used to seek to block a full merger, it cannot block an operational combination between two companies.

The majority of Euronav’s shareholders are supporting the combination as evidenced by the strong market response as well as the massive amount of votes against the appointment of three (3) non-independent directors proposed by CMB at the Euronav AGM last May.

Euronav shareholders participating in the exchange will receive Frontline shares, at a fair exchange ratio of 1.45x Frontline share for each Euronav share, and will maximise their benefit from the combination, including the full advantages of the increased scale, operational synergies, and best-in-class leadership platform.

Euronav shareholders not participating in the exchange offer should be aware that, despite Euronav continuing to comply with all rules applicable to Belgian listed companies, they may face challenges associated with reduced liquidity and investor demand, associated with Euronav’s controlled status and limited float.

We look forward to developing the combination further early in the new year and wish all our stakeholders a pleasant holiday period.

Frontline intends to formally launch the tender offer, in which case it will deposit a file for this purpose with the Belgian Financial Services and Markets Authority (FSMA), including a draft prospectus. The Euronav Supervisory Board will then examine the draft prospectus and present its detailed opinion in a response memorandum. If Frontline decides not to proceed with the tender offer, it will report about this in accordance with its legal obligations.

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