AMSC sells Jones Act tanker business to Maritime Partners

Oslo-listed American Shipping Company (AMSC) has sold its fleet of Jones Act-compliant tankers to Louisiana-based Maritime Partners.

A newly-formed company owned and controlled by a fund managed by Maritime Partners will take over AMSC’s subsidiary American Tanker Holding Company (ATHC) which owns nine handysize product tankers and one handysize shuttle tanker, all of which are bareboat chartered to Overseas Shipholding or Keystone Shipping.

The Aker-dominated AMSC will receive gross cash proceeds of $249.3m, divided between consideration for the shares in ATHC and repayment of a shareholder loan, reflecting an enterprise value of ATHC of nearly $747m.

“This acquisition will nicely complement our existing lease portfolio by diversifying lessee exposure, asset exposure and end market exposure within the protected Jones Act markets,” said Bick Brooks, the co-founder and CEO of Maritime Partners.

The deal is expected to close by October 31, 2023, with a final deadline set for December 22 when each party has a right to terminate the transaction.

AMSC intends to resolve paying an additional dividend of $170m, after the sale. The remaining cash proceeds will be used for general corporate purposes and equity for future investments in new projects, the company said.

The Lysaker-based company, established in 2005, will continue to own the offshore subsea construction vessel Normand Maximus on bareboat contract to Solstad Offshore and remain listed in Oslo, with Aker as a key shareholder and the existing management and board of directors.

Commenting on the deal, Pål Lothe Magnussen, CEO of AMSC, said: “We believe this is the ideal new owner of this business for the next phase in the lifecycle of these assets. AMSC’s ownership tenure has surpassed 18 years since the ships were ordered, during which significant financial profits have been created and provided to AMSC and its shareholders. We believe that the long remaining commercial life of the fleet in combination with strong bareboat charter contract cover in a strong market represents a good opportunity and point in time for us to reconsider capital allocation for AMSC and strategy going forward, and this transaction is a natural step in this process.”