GasLog Ltd, the LNG carrier fleet owner with 36 ships split with its US affiliate GasLog Partners, has held a private share placement “par excellence” with the participation of Greek and Chinese shipping dynasties, including the Tung family of China, the Onassis Foundation and the Greek Livanos family.
“I’m pleased to welcome the Tung family, with their long maritime history and roots in Asia, as shareholders,” said Paul Wogan, Chief Executive of GasLog.
“We look forward to working with them to deliver the value inherent in the GasLog fleet and our leading operating and commercial platform,” he added.
In 2017, the Tung family sold its controlling block of shares in Orient Overseas (International), the shipping company led by Tung Chee-hwa to China’s Cosco Shipping and Shanghai International Port Group.
The family received HK$34 billion (US$4.4Bln) from the transaction.
Orient Overseas was founded by Tung Chee-hwa's father, Tung Chao-yung, in 1969 and became the seventh-largest container shipping company in the world.
Clarksons Platou Securities AS acted as financial advisor to GasLog during the placement.
A special committee of the board of directors of GasLog, comprised entirely of independent members, reviewed the transaction.
Evercore served as financial advisor to the special committee.
In the placement, GasLog sold 14.40 million common shares at a price of $2.50 per share for total gross proceeds of $36.0M. The net proceeds of the placement are expected to be used for general corporate purposes.
About 75 percent of shares issued in the placement were purchased by GasLog’s directors and affiliates, including 6.50M shares purchased by Blenheim Holdings, wholly owned by the Livanos family and 4.0M common shares were purchased by an affiliate of the Onassis Foundation.
GasLog had posted a first-quarter 2020 loss as LNG demand faced multiple headwinds.
GasLog reported a quarterly net loss of $39.43 million versus a profit of $5.89M in the same three months a year ago.
In between the two earnings statements, GasLog brought in cost-cutting measures and among them was moving its headquarters from Monaco to the Greek port of Piraeus.
In the share placement, Blenheim Holdings also agreed not to sell the shares purchased for a period of 180 days.
“Our first-quarter results announcement set out a series of management actions to address the unprecedented market disruption caused by the Covid 19 pandemic,” said GasLog.
“We also updated the market on the progress of the refinancing of our 2021 debt maturities and the status of our interest rate and foreign exchange swap exposures,” it added.
In order to further supplement the management actions announced on May 6, 2020, the board has decided to raise $36M, or 17.8 percent percent of shares outstanding of the company prior to the private placement, to increase liquidity and further strengthen the capital structure of GasLog.
The board decided to execute the financing on a private placement basis with its core shareholders to provide both certainty and minimise any disruption against a volatile market backdrop.
CEO Wogan explained that he was delighted two of the major shareholders had provided this level of support to the company at this time and as they had done since GasLog’s initial public offering in 2012.