Israeli billionaire Idan Ofer has joined forces with Norwegian tycoon Tor Olav Trøim to form a new LNG shipping company, CoolCo.
Under the terms of the agreement, Idan Ofer-controlled Eastern Pacific Shipping (EPS) will invest $150m in the new company, which will acquire Tor Olav Trøim-led Golar LNG’s eight TFDE LNG carriers, with plans to raise equity and separately list on Euronext Growth in Oslo during Q1 2022.
CoolCo is also expected to acquire the commercial and technical organisation associated with the operation of Golar’s owned and operated shipping and FSRU assets.
The anticipated IPO proceeds will, together with a contemplated debt refinancing, be used to acquire the vessels from Golar, secure attractive financing and provide CoolCo with working capital to position the company for further growth, EPS said. The outstanding contractual debt associated with the eight ships was $858m as of September 30, 2021.
Golar intends to retain around one-third of the new entity, while EPS will become the largest shareholder and will chair the board of directors.
Cyril Ducau, CEO of Eastern Pacific Shipping, commented: “EPS is pleased to be adding LNG shipping to our diverse shipping portfolio. LNG will play an essential role as a commodity and marine fuel as the world transitions to cleaner energy solutions. Golar’s solid track record, mature platform, and like-minded vision made this investment an easy decision. As a provider of dual-fuel LNG tonnage across all our segments, EPS looks forward to taking a leading role in making CoolCo a world-class leader in LNG shipping, combining our complementary skills and expertise with Golar’s.”
Karl Fredrik Staubo, CEO of Golar, added: “We are encouraged by the strong underlying market fundamentals for LNG carriers The Cool Company transaction will allow Golar to separate its shipping businesses and simplify its corporate structure, while maintaining significant and attractive exposure to the LNG carrier business.”
In a joint statement, the companies noted that the transactions are subject to the satisfactory negotiation and execution of equity purchase agreements with EPS and Golar, lessor consents, debt financing and the completion of a private placement or placements to third party investors. Each of those agreements, if executed, will contain additional closing conditions.