Saltchuk to Acquire Overseas Shipholding Group
Seattle-headquartered Saltchuk on Monday announced it has entered into a definitive agreement to acquire Overseas Shipholding Group (OSG), a New York-listed marine transportation company based in Tampa, Fla., in a deal worth $950 million.
Privately-held Saltchuk—OSG’s largest shareholder—said the transaction assigns OSG an aggregate equity value of approximately $653 million. Under the deal's terms, 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, a 61% premium to OSG’s 30-day volume-weighted average price on January 26, 2024, 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.
Saltchuk said the agreement has received unanimous approval from the boards of both companies and that it will fund the transaction through a combination of committed debt financing and cash on hand. The company said it expects the deal to close within the next few months.
Douglas D. Wheat, chairman of the OSG board of directors, said, “Following Saltchuk’s indication of interest to buy [OSG] at the end of January, the board of directors, with the assistance of external financial and legal advisors, undertook a review of the company’s financial and strategic alternatives, including remaining a publicly held company. 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.”
The takeover comes on Saltchuk's second attempt after it suspended a previous bid in 2021 due to pandemic-related market uncertainties.
OSG, an operator of U.S.-flag tankers and articulated tug barges (ATB), will become a standalone business unit within Saltchuk, joining other maritime brands within the group such as TOTE, Foss, AmNav, Young Brothers, Tropical Shiping and Cook Inlet Tug & Barge, among others.
“We are excited to enter into this new chapter together with Saltchuk, which has been a significant shareholder of OSG over the past several years and has a close understanding of our business,” said Sam Norton, OSG’s president and CEO. “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.”
Mark Tabbutt, chairman of Saltchuk Resources, said, “OSG, our nation’s leading domestic marine transporter of energy, has a strong cultural fit with Saltchuk and shares our commitment to operational safety, reliability, and environmental stewardship. On behalf of the Saltchuk organization, we look forward to welcoming more than 1,000 members of the OSG team to our family of companies and growing the enterprise through multi-generational investments.”