Aegean brings in Mercuria Energy

Jul 06 2018

Aegean Marine Petroleum Network has signed a Memorandum of Understanding (MOU) with Mercuria Energy Group and its affiliates, one of the world’s largest independent commodities and energy groups.

The company explained that this move was made to support Aegean’s existing US and global revolving credit facilities and to explore a global strategic partnership.


Aegean chairman and independent director of the board, Donald Moore, said, “As part of the announced strategic review, the new leadership at Aegean has, in short order, brought forward an opportunity to completely redefine and optimise the company’s capital structure, enhance near term liquidity and position the company for a dynamic partnership with one of the world’s largest privately held integrated energy and commodity groups.


“Importantly, the agreement provides for immediate credit support from Mercuria for the benefit of Aegean’s banks, customers, suppliers, and logistics providers, putting the strength of one of the world’s largest independent energy and commodity companies behind Aegean,” he added.


“We look forward to further developing our relationship with Aegean and providing the flexibility to execute a strategy that enhances the company’s operations and positions the company for long-term success,” said Magid Shenouda, Mercuria’s Global Head of Trading.


Under the terms of the agreement, Mercuria intends to provide a $1 bill trade finance facility intended to support Aegean’s existing US and global revolving credit facilities.


Mercuria will also provide increased liquidity to Aegean of not less than $30 mill, adding flexibility to Aegean’s operations. Upon closing of the trade finance facility, the company will issue new shares equal to 30% of its common stock (on a pro-forma basis) to Mercuria and will invite a representative of Mercuria to join the board.


The agreement also opens the way for a potential broader strategic partnership between Aegean and Mercuria, including operational services, trading and hedging arrangements, and other support projects.


Mercuria has the exclusive right to complete the trade finance facility by 15th August , 2018, and to pursue the strategic partnership transaction until 31st January, 2019, subject to specified exceptions and termination events.


The transactions are still subject to final documentation and regulatory analysis, and there can be no assurance this will be completed, Aegean warned.


Moelis & Company is serving as financial advisor and Kirkland & Ellis is acting as legal advisor to Aegean with respect to the transaction. Milbank, Tweed, Hadley & McCloy is acting as legal counsel to Mercuria.


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