CMB ordered to pay US$36 million to Euronav shareholders
Euronav shareholders in line for a US$46 million payout following court ruling against CMB
NEW YORK, Oct. 9, 2024 – The shipping company CMB has been ordered by the Belgian financial regulator (FSMA) to pay an additional US$36 million to shareholders who tendered shares during its mandatory takeover (MTO) of Euronav earlier this year. The stock market watchdog is also forcing CMB to reopen its takeover bid offer to shareholders who chose not to sell in March 2024.
The FSMA decision to retrospectively increase the price of each of the 69.2 million shares already tendered to US$18.28 – adding an additional $0.52 per share – follows a ruling by the Brussels Market Court last month. That judgement ordered the FSMA to re-examine the bid price after finding in favor of the minority shareholders, FourWorld Capital Management LLC, who brought the case before the courts against CMB.
John Addis, Founder and Chief Investment Officer (CIO) of FourWorld said:
“In accepting the recommendation of the Brussels Market Court, this FSMA decision helps to protect the rights of overlooked minority shareholders. Although this is a victory for minority shareholders, we are disappointed the regulator has not used its expertise and specialist industry knowledge to complete an independent calculation of the true share value at the time of takeover. We must now consider whether to appeal on this matter. However, overall, this is an important step in our legal case against CMB and Frontline as we continue to fight for a fair outcome that holds majority shareholders to account.”
Anyone seeking to find out more about the history of this dispute can go to www.euronavscuttled.info. This website also contains further information regarding a separate legal challenge, underway in the Antwerp Enterprise Court for the unwinding of CMB’s mandatory takeover, Euronav’s $2.35 billion fleet sale to Frontline, and Euronav’s decision to renounce and settle its arbitration claim against Frontline.
The case is scheduled to appear before the Antwerp Enterprise Court in May 2026.
Notes for Editors
About FourWorld Capital Management LLC: FourWorld Capital Management is an SEC registered investment adviser with offices in New York and Munich. The company has a particular focus on legal and regulatory catalysts and is currently fighting for a fairer deal on behalf of minority shareholders who lost out during CMB's mandatory takeover of Euronav NV in 2024 and following its failed merger with Frontline.
Euronav shareholders in line for a US$46 million payout following court ruling against CMB
NEW YORK, Sept. 9, 2024 -- On Friday, the Brussels Market Court in Belgium ruled that Compagnie Maritime Belge (CMB) wrongly calculated the offer price of shares during its mandatory takeover of Euronav NV in February this year.
The court decided the value of each share should be retrospectively increased by at least US$0.52, amounting to an additional pay out of US$46 million. This sum takes into account the 69.2 million shares tendered in March 2024, and those remaining that may be sold if the public offer is re-opened.
The Markets' Court found that when calculating the bid price, CMB had failed to take into account special advantages worth US$104 million granted to Frontline when simultaneously selling it the best part of Euronav's fleet (its newest 24 VLCC's or very large crude carriers).
The Court's findings are exceptionally critical of CMB and Frontline (quotes translated from court judgement):
"It is particularly curious that the negotiations regarding the sale of the fleet, although they involved a transaction between Frontline and Euronav, took place exclusively between Frontline and CMB. Euronav was not at the negotiating table. As FourWorld rightly puts it, Euronav was completely sidelined" (para. 112)
"CMB and Frontline exerted tremendous pressure on Euronav's supervisory board. (…) The independent chairwoman of the council, in particular, was placed under intense pressure" (para. 115)
"Under normal market conditions, transactions are negotiated between directly involved parties, especially between buyer and seller. This is not what happened here. The price of about 2.35 billion dollar paid by Frontline cannot therefore be considered market-conform under these circumstances. This price implied a particular advantage in favor of Frontline." (para. 117)
This ruling breaks new legal ground in Belgium and abroad regarding judicial protection of the minority shareholders, putting brazen bidders willing to game the system on notice.
These findings were only made possible after key documents, including supervisory board meeting minutes, legal and financial advice and further evidence, were made available to the public following a court ruling in the United States earlier this year in a case also brought by FourWorld Capital Management LLC (FourWorld).
John Addis, Founder and Chief Investment Officer (CIO) of FourWorld said:
"Friday's ruling makes it clear that Euronav's two largest shareholders acted to serve their own interests at the expense of the company and minority shareholders which is an important first step in unravelling this deal. We believe there was a far greater cost to independent shareholders than recognized by the Brussels Market Court on Friday.
"CMB and Frontline managed to pull off the deal of a lifetime underneath the noses of Euronav's supervisory board and financial regulators. Our years of experience fighting for minority shareholder interests has shown that if a deal looks too good to be true, it probably is. FourWorld will continue to fight through the courts for a fair outcome to this case."
The Brussels Markets' Court placed the resolution of the share price adjustment firmly back in the jurisdiction of the Belgian financial regulator (FSMA), ordering it to re-examine the bid price taking into account its findings. This means that the FSMA may yet increase the bid price by more than 0,52 US$ – something FourWorld will ask it to do.
Having concluded that Euronav's Supervisory board was sidelined and then coerced, this ruling paves the way for success in a separate legal challenge currently underway in the Antwerp Enterprise Court. In that case, FourWorld has petitioned for the unwinding of CMB's mandatory takeover, Euronav's US$2.35 billion fleet sale to Frontline and Euronav's decision to renounce and settle its arbitration claim against Frontline.
The case is scheduled to appear before the Antwerp Enterprise Court in May 2026.
Notes for Editors:
About FourWorld Capital Management LLC:
FourWorld Capital Management is an SEC registered investment adviser with offices in New York and Munich. The company has a particular focus on legal and regulatory catalysts and is currently fighting for a fairer deal on behalf of minority shareholders who lost out during CMB's mandatory takeover of Euronav NV in 2024 and following its failed merger with Frontline.
SOURCE: FourWorld Capital Management LLC