Supervisory Board letter to Euronav shareholders

May 05 2022

Euronav NV (“Euronav” or the “Company”) has issued the following letter from the Supervisory Board to Euronav shareholders ahead of the AGM on May 19th, 2022.

Dear Shareholders,


Developments over the past four months support our expectation that 2022 will be a transformative and exciting year for Euronav. With Euronav’s share price up 44% year-to-date, this is the strongest start of the year in the past decade. Furthermore, there are a number of value-creating milestones scheduled for later this year.


Recent Activities and Performance

Under the direction of the Supervisory Board, the Management team has positioned Euronav to maximize the Company’s value creation potential over the medium and long-term.


Year-to-date, as part of its fleet rejuvenation program, Euronav purchased two eco-VLCCs, took delivery of two new Suezmaxes, and sold four older S-class VLCCs as well as an older Suezmax. The combination of these two transactions demonstrates the Company’s focus on the modernisation of its fleet and on the improvement of the fleet consumption and emission profile, which in turn enables Euronav to maximise the overall return to shareholders of the Company. The transactions have reduced the average age of Euronav’s fully owned VLCC fleet from 7.3 years to 6.6 years, making it amongst the youngest VLCC fleets globally.


Combination with Frontline

On April 7th, 2022, Euronav and Frontline announced their agreement on the principal terms for a proposed stock-for-stock combination between the two companies. The proposed transaction has been unanimously approved by the independent Supervisory Board of Euronav and the Frontline Board of Directors. The proposed transaction was also well received by investors, as Euronav shares opened 8% higher following the announcement. Since then, market commentary has been overwhelmingly positive, praising the benefits arising from creating a global leader in the tanker market.


The combined group would continue to operate from Belgium (where Hugo De Stoop will be based as the Chief Executive Officer of the combined platform), Norway, UK, Singapore, Greece and the US. The Board of Directors of the combined group is expected to consist of seven members, including three current independent Euronav Supervisory Board members, two nominated by Hemen Holding Limited and two additional new independent directors. The combined group is intended to be listed on the regulated markets of Euronext Brussels, Oslo Børs and the New York Stock Exchange.


Highlights of the proposed transaction include:

• Leading global tanker market participation with 140 vessels consisting of 65 VLCC, 55 Suezmax and 20 LR2/Aframax vessels

• A strong balance sheet and access to attractive financing, supporting industry leading operational break-even levels for the combined fleet

• Significant benefits arising from a larger combined fleet leading to, among other advantages, improved overall utilization and cost synergies which will increase shareholder value

• Significant synergies related to SG&A and other savings expected to be extracted from the combined entity

• Leading combined expertise in the shipping industry with the ability to attract and retain world-class talent

• Leadership in sustainable shipping, aiming for the highest ESG standards in the industry



As part of Euronav’s continuous process to review and enhance its governance, several steps have been taken to bolster the Supervisory Board’s composition and make the remuneration policy for executives even more transparent.


Based on the recommendation of the Corporate Governance and Nomination Committee, the Supervisory Board is proposing to the next AGM that Steven Smith be elected as an independent Director. Mr. Smith brings in-depth financial expertise, built from a career as an investor (partner at Aurora Capital) and as an investment banker at UBS working in the US and globally.


Mr. Smith’s deep knowledge and experience in corporate finance, coupled with his thorough understanding of the shipping industry, will be beneficial as the Supervisory Board discusses the various strategic and financial considerations ahead of the Company. Mr. Smith will also be highly additive to the ongoing engagement with Frontline, as his financial acumen, banking background and investor perspectives enhance the Supervisory Board’s existing capabilities. Furthermore, his expertise in US public markets will bring valuable perspective to the Supervisory Board with respect to Euronav’s New York Stock Exchange listing considerations.


Overall, the continuity of the existing Supervisory Board members, coupled with Mr. Smith’s additional skills, provide the right expertise, knowledge and perspective to help to reach an optimal outcome for Euronav and its shareholders.


Euronav also continues to strive for transparency in its remuneration policy in order to make the mechanisms clearer for shareholders. The Company has consistently sought to provide insight regarding the performance award levels, performance criteria and performance targets for the incentive plans of its teams, enabling shareholders to assess the stringency of the plan and the relationship between remuneration and performance:

• The descriptions of short-term and long-term variable remuneration offer further detail compared to past years, and clearly disclose the applicable performance metrics

• The Company has provided more details on the level of achievement of the targets within the Long-Term Incentive Plan, as well as on the companies selected to constitute the Total Shareholder Return peer group


Update on Sustainability

On May 5th, we will be updating our stakeholders on our sustainability strategy, including our detailed decarbonisation targets (“Euronav's road to decarbonisation”). As we have communicated in the past, Euronav is a leader in sustainable shipping and is continually striving to elevate the environmental and sustainability standards of the tanker industry.


Some of Euronav’s sustainability achievements include:

• The Company is committing to net zero emissions by 2050, with the ambition to improve on this timeframe – the first tanker company to make such a pledge

• With 41% of our current financing being sustainability-linked, Euronav is at the forefront of corporate sustainable financing efforts

• Euronav is the only listed tanker company with a joint Executive and Supervisory Board committee focused on sustainability

• Euronav has earned best-in-class sustainability ratings across major ESG rating agencies such as CDP, S&P, Sustainalytics, MSCI, Webber Research and Bloomberg (including the Bloomberg Gender-Equality Index)


Alternative Shareholder Proposal – CMB

As indicated on Euronav’s revised AGM agenda published on May 4th, the company has received from CMB additional proposed resolutions to appoint three Directors (all non-independent) for election to the Supervisory Board at the Company’s Annual General Meeting that is to take place on May 19, 2022. Having conducted a thorough analysis of these resolutions, on April 29, 2022, Euronav announced its decision to recommend that shareholders vote AGAINST the resolutions put forward by CMB. 


Euronav’s Supervisory Board believes that the proposed directors put forward by CMB will pursue an agenda that the Supervisory Board has thoroughly analysed and assessed as likely to be value destructive for the other shareholders.


This agenda, as CMB has made public, seeks to contribute CMB.Tech (the early-stage CMB division of diversified marine and industrial applications running on hydrogen and Ammonia) into Euronav in exchange for a substantial issuance of Euronav shares, followed by the monetisation of Euronav’s existing tanker fleet in the short-term and a use of the proceeds to fund the development of CMB.Tech. This phase-out of Euronav’s current business is at odds with the expectations of Euronav’s current other shareholders and with the strategy that Euronav has been consistently communicating to the market.


Over the last six months, CMB has approached Euronav’s Supervisory Board on several occasions with a number of proposals including alternative business plans.


The Supervisory Board has thoroughly reviewed such plans and has taken independent advice from financial and legal advisors when analysing the multiple alternative proposals received from CMB. Each time, the Supervisory Board has come to the unanimous conclusion that any proposed combination with CMB.Tech would not be in Euronav’s best interest and would most likely destroy shareholder value. CMB’s proposals involve no synergies and offer no prospect of dividends over the coming years given the substantial capital investment programme required.


Furthermore, based on the CMB.Tech valuation that was formally proposed on December 16, 2021, the CMB proposals would constitute a highly dilutive transaction which would benefit only CMB, with the share consideration resulting in CMB potentially gaining control of approximately half of the share capital of the Company based on their current shareholdings, at the expense of current Euronav shareholders.


CMB’s plans call for a radical move away from Euronav’s core tanker shipping business model and would transform the Company into a diversified shipping and industrial group, substantially increasing its risk profile, complicating its equity story and moving it away from its strategic focus. Euronav is categorically not the appropriate investment vehicle for such diversified and highly capital intensive business ventures.


Fundamentally, Euronav believes that the lack of independence of the additional candidates proposed by CMB would weaken the Supervisory Board’s profile. Each of these candidates is non-independent because of his strong connections to CMB and would be unable to offer an unbiased view on the best strategy for Euronav. This would create a potential conflict of interest for every single investment and strategy decision presented to the Supervisory Board and would undermine the Company’s commitment to upholding the highest standards of governance.


Therefore, we invite you to vote AGAINST the additional, non-independent and conflicted candidates put forward by CMB for the Supervisory Board and to vote only in FAVOUR of the three Euronav nominees.



Today, the future of Euronav is very exciting. Market fundamentals are in a constructive phase. The orderbook remains at 20-year lows, yet the global tanker fleet age is at 20-year highs. Crude inventory levels are at 8-year lows and will eventually require rebuilding with both oil supply and consumption set to regain pre-pandemic levels during 2022. Euronav is well positioned to realize its full value creation potential from these improving market conditions over the next 12 months.


While the sustainability ambitions of CMB.Tech are appreciated and resonate with Euronav’s own ESG strategy, such a business model shift would be entirely inconsistent with Euronav’s long-term strategy and risk profile. In addition, Euronav does not believe that CMB.Tech would enhance the Company’s capacity to navigate the energy transition. In addition, Euronav intends to fully decarbonise its business by 2050 and does not require CMB.Tech’s involvement to do so.


Finally, the market consolidation opportunity available today, including the announced combination with Frontline, is expected to create additional value for our shareholders, with material synergies and other combination benefits. The Supervisory Board is confident that the Euronav strategy is the right path to maximise shareholder value.


We invite you to express your support by voting in FAVOUR of the Company’s candidates for the Supervisory Board at the AGM on May 19th. Further information on the AGM and information on how to vote is included on the website. Registration, proxies and/or votes by letter must be received by May 13th.


Thank you




The Euronav Supervisory Board


Related News

Navios Maritime Partners L.P. reports financial results for the first quarter

(May 12 2022)

Navios Maritime Partners L.P. (“Navios Partners”), an international owner and operator of dry cargo and tanker vessels, reported its financial results for the first quarter ended March 31, 2022.

International Seaways adopts limited duration stockholder rights plan

(May 12 2022)

International Seaways, Inc. (the “Company” or “INSW”) one of the largest tanker companies worldwide providing energy transportation services for crude oil and petroleum products, announced that its Board of Directors has unanimously adopted a limited...

Stolt Tankers to purchase three 33,600 DWT chemical tankers

(May 12 2022)

Stolt-Nielsen Limited (Oslo Børs: SNI) announced that Stolt Tankers B.V. has entered into agreements to acquire three 33,600 dwt stainless steel chemical tankers built in Japan.

Sale of Suezmax tanker Stena Supreme

(May 12 2022)

Concordia Maritime has entered into an agreement for the sale of the Suezmax tanker Stena Supreme (158,000 dwt, built in 2012).

TEN Ltd. announces the sale of a 2006-built LR2 product tanker

(May 05 2022)

TEN, Ltd. (TEN) (the “Company”) announced the sale of a 2006-built LR2 aframax tanker, one of the largest product tankers in the world at the time of its construction, to unrelated entities.

Jun-Jul 2024

Tanker Operator Athens report: managing crewing, training challenges, views on SIRE 2.0