Frontline’s Attempt to Stop DHT’s VLCC Acquisition Falls Through in Court
The Supreme Court of the State of New York has rejected Frontline’s attempt to stop DHT’s acquisition of very large crude carrier (VLCCs) fleet from BW Group.
On April 18, 2017, Norwegian-based tanker company Frontline filed a complaint against DHT Holdings, BW Group Limited, and DHT Board of Directors alleging that the crude oil tanker company directors breached their fiduciary duties related to the vessel acquisition agreement inked in March 2017 with BW, a Bermuda-incorporated LPG carrier.
Under the terms of the deal, DHT agreed to acquire 9 VLCCs and newbuild contracts for 2 VLCCs from BW.
The complaint sought to prohibit the consummation of the deal, including the delivery of the VLCCs to DHT.
DHT said the allegations were without merit.
On April 19, 2017, the court rejected Frontline’s arguments and issued an order denying Frontline’s motion for a preliminary injunction and temporary restraining order.
The reasons cited by the court for denying Frontline’s motion included the “inexcusable timing” of Frontline’s filing, Frontline’s failure to establish that the court has jurisdiction over either DHT, the company directors or BW in addition to its failure to establish a probability of success on its claim that the transaction violated applicable Delaware law at this stage of the case.
Earlier today, DHT informed that it has taken delivery of the first vessel from the batch, the 299,500 dwt tanker DHT Utik, previously known as BW Utik. The second unit is slated for delivery to DHT on April 21, 2017.
The company said that it expects to have all nine vessels in the water during the second quarter 2017.