LNG

US LNG equipment-maker Chart Industries completes acquisition of the Microbulk cryogenic tank intellectual property, equipment, and other assets from privately-held IC Biomedical.

Chart Industries, the US liquefied natural gas and industrial gases equipment supplier with a widening international presence in Europe and Asia, has authorized the repurchase of up to $75 million of its common stock over the next 12 months. 

Under the stock repurchase program, Chart may purchase shares of its common stock through various means, including open market transactions, block purchases and privately negotiated transactions in accordance with  federal securities laws.

“This stock buyback program reflects our confidence in our business going forward, and we believe our shares are an attractive investment opportunity,” said Chart’s Chief Executive Jill Evanko.

“Our strong cash flow simultaneously enables us to return value to shareholders, pay down debt, and deploy capital for productivity and growth opportunities,” explained the CEO.

Analysts say that companies usually buy back their shares because management considers them undervalued. 

The company buys shares directly from the market or can offer its shareholders the option of tendering their shares.

A share buyback reduces the number of outstanding shares, which can increase both the demand for the shares and the price.

Chart said that the timing and amount of any repurchases under this program will be determined by Chart’s management at its discretion based on a variety of factors, including, but not limited to, trading volume and market price.

The company, whose headquarters are in the suburbs of Atlantic in Georgia, was been building its business in North America during the LNG plant buildout as well as in Europe with trucking fuel equipment and in Asia with proposed joint ventures.

Chart signed a letter of cooperation in February 2020 with ExxonMobil India LNG Ltd, an affiliate of the US  major, and Indian Oil Corp. to focus on delivering LNG by Indian roads, railroads and waterways to spread gas use in the absence of physical pipelines.

The accord upgrades a previous Memorandum of Understanding between Chart in Indian Oil to promote the development of the LNG market in India.

It stated that the companies would focus on modular liquefaction, regasification applications, LNG bunkering, fueling stations and alternative LNG mobile transportation including ISO containers.  

Chart said the new Letter of Cooperation expanded the reach and potential scale within a significantly growing country that has committed to clean energy options.

Chart Industries, the US liquefied natural gas and industrial gases equipment supplier, has signed a letter of cooperation with ExxonMobil India LNG Ltd, an affiliate of the US  major, and Indian Oil Corp. to focus on delivering LNG by Indian roads, railroads and waterways to spread gas use in the absence of physical pipelines.

Sea-LNG, a global coalition of energy and shipping companies and other sector participants backing the increased use of liquefied natural gas as a maritime fuel, has signed up US LNG equipment-maker Chart Industries as the newest member.

Chart Industries, the maker of equipment for the liquefied natural gas and industrial gas industries, said it was awarded the contract to supply four LNG fuel tanks for the marine fuel-gas systems of two LNG-powered chemical tankers being built at the Wuhu Shipyard on the banks of the Yangtze River in China.

Chart said the contract was awarded on behalf of the owners of the two 22,000 deadweight-ton vessels, Rederi AB Donsotank from Sweden through project company LGM Engineering.

“Each of the 300 cubic metres capacity cryogenic tanks comprise double stainless steel shells with vacuum and perlite insulation,” said Chart.

The US company explained that the tanks would be designed and manufactured at Chart’s Changzhou facility in China and approved by the European maritime classification society, DNV GL.

“Chart’s technology is integral to the increased number of LNG-powered ships on international waters and the bunkering infrastructure required to fuel them,” said Robert Chen, President of Chart’s distribution and storage division for Asia.

Chart, whose headquarters are in the suburbs of Atlanta, has said it continued to see revenue and orders strengthen in particular in the liquefaction, storage and transport markets for global LNG, industrial gas infrastructure and small-scale ventures.

The company is a supplier of equipment to US LNG export projects on the Gulf Coast being developed by Cheniere Energy, Tellurian Inc. and Venture Global.

Chart said on September 10 that it had received full notice to proceed for the production of cold boxes and brazed aluminum heat-exchangers for the Calcasieu Pass LNG export plant being developed by Arlington, Virginia-based Venture Global.

Calcasieu Pass will produce more than 10 million tonnes per annum of LNG and is expected to come on stream in 2022, along with associated facilities, including the TransCameron Pipeline.

Chart’s most recent earnings underpinned the advance of global LNG projects as quarterly revenue increased by 7 percent to $309.6M over the previous three months.

Chart completed its latest acquisition in July 2019 when it took over Harsco Corp.’s Air-X-Changers business, specializing in gas compression coolers.

Chart Industries, the US LNG and industrial gases equipment provider, has priced its underwritten public offering of 3.5 million shares at $73.50 per share to fund a portion of the purchase price of its pending acquisition of Harsco Corp.’s Industrial Air-X-Changers business.

Chart has also granted the underwriters a 30-day option to purchase up to an additional 525,000 shares.

The company estimates that the net proceeds of the offering will be around $248.8 million, or $286.3M if the option to purchase additional shares by the underwriters is exercised in full, after deducting underwriters discounts and commissions and transaction expenses.

Chart’s shares were last trading on June 12 at $74.55 on the Nasdaq global stock exchange, valuing the company at $2.37 billion.

J.P. Morgan Securities, Credit Suisse Securities (USA) and Morgan Stanley & Co. acted as joint lead book-running managers for the offering and Evercore Group and Wells Fargo Securities will act as book-running managers.

Chart’s previously arranged financing consists of a revolving credit facility and a new term loan, both of which were over-subscribed by banks keen to lend.

The share offering was closing on June 14, concurrent with the finalization of the commitment from banks for $1.1 billion in credit facilities.

Chart said the acquisition of Harsco’s Air-X-Changers business was now expected to close on July 1.

“While our proposed offering of common stock was significantly over-subscribed, the associated pricing was at the lower end of our anticipated range,” said Chart Chief Executive Jill Evanko.

“We decided to size the offering to a level that would meet the needs of the business and support our growth and profitability objectives, while also acting in the interest of current shareholders by reducing anticipated dilution,” the CEO explained.

Chart, based in the outskirts of Atlanta, Georgia, agreed in May 2019 to take over Harsco in its fourth acquisition in two years as it continues to receive LNG orders for key equipment.

The Harsco AXC business specializes in gas compression coolers.

The company reiterated its full year 2019 sales forecast of between $1.41 billion and $1.46Bln.

The guidance assumes LNG project revenue in 2019 from the Venture Global Calcasieu Pass and “Golar Gimi” LNG production hull projects of $28M to $30m, subject to project timing.

Harsco AXC is projected to generate net sales of around $260M in 2019, and a 23 percent gross earnings margin as a percentage of sales.

The Chart acquisition is the fourth in the past two years after other takeovers in the US and Europe.

Chart first expanded its business in 2017 by acquiring German company VCT Vogel, a servicer of cryogenic and mobile gas tank equipment and trucks and a European leader in truck-mounted drive and control systems.

The takeover of the German company followed its $410M cash purchase of smaller US sector rival Hudson Products for its range of air-cooled heat exchangers and axial flow cooling fans for the refining, petrochemical and natural gas markets.

Then in September 2018, Chart agreed to acquire Italian company VRV S.p.a., an engineer and designer of cryogenic equipment whose offerings also complement Chart’s products.

The Harsco group has said that the proceeds from selling its Harsco AXC gas compression subsidiary would be used to pay debts and provide the parent company with additional financial flexibility to its transformation into an environmental solutions operator.

Chart Industries, the US LNG and industrial gases equipment provider, has received commitments for $1.1 billion in financing to help fund the acquisition and integration of Harsco Corp.’s industrial Air-X-Changers business, Harsco AXC.

Chart Industries, the US LNG and industrial gases equipment provider, has agreed to acquire Harsco Corp.’s Industrial Air-X-Changers business for $592 million in cash as it makes its fourth acquisition in two years to broaden its sector offerings.

Chart Industries, the manufacturer of engineered equipment for the industrial gas and energy industries, announced the release of the updated version of its liquefied natural gas processing technology.

Chart Industries, the US LNG equipment maker and industrial gases company, has signed an agreement to acquire Italian company VRV S.p.a., an engineer and designer of cryogenic equipment that will complement Chart’s own offerings.