Overseas Shipholding Group and Saltchuk Resources announced that they have entered into a definitive merger agreement pursuant to which Saltchuk has agreed to acquire OSG.
Under the terms of the agreement, which has been unanimously approved by the Board of Directors of both companies, Saltchuk will commence a tender offer to acquire all outstanding shares of OSG it does not already own for $8.50 per share in cash. The purchase price represents a 61% premium to OSG’s 30-day volume-weighted average price on January 26, 2024, the last day of trading before Saltchuk disclosed its non-binding indication of interest, as well as a 44% premium to the January 26 closing price of OSG’s shares and a 36% premium to Saltchuk’s initial indicative price of $6.25 per share.
As part of that review, the Board conducted a comprehensive process in which it engaged with Saltchuk and approached and engaged with other potential transaction counterparties. Informed by its review and that process, the Board firmly believes Saltchuk’s increased offer represents compelling value to, and is in the best interest of, our shareholders not affiliated with Saltchuk.
… said Douglas D. Wheat, Chairman of the OSG Board of Directors.
Saltchuk’s operating companies have distinguished themselves in their respective segments, and this transaction partners us with an organization that shares our values and focus on customers. We are thrilled to soon join the Saltchuk family of companies.
..said Sam Norton, OSG’s President and Chief Executive Officer.
Following the close of the transaction, OSG will operate as a standalone business unit within Saltchuk, becoming a member of its family of diversified freight transportation, marine service, and energy distribution companies.
The closing of the tender offer will be subject to customary closing conditions, including the expiration of the Hart-Scott-Rodino Act waiting period and the tender of shares representing, together with the shares already owned by Saltchuk, at least a majority of OSG’s outstanding shares of Class A common stock, and is expected to close in the next few months. Promptly following the successful completion of the tender offer, Saltchuk will acquire all remaining OSG shares not purchased in the tender offer through a second-step merger at the same price.
As explained, the transaction is not subject to a financing condition. It will be funded through a combination of committed debt financing and cash on hand.