Seaspan’s parent accepts $10.9 billion buyout bid

Atlas Corporation, the owner of the world’s largest lessor of containerships, Seaspan Corporation, has entered into a definitive acquisition deal with the Poseidon Acquisition Corp under which Poseidon will acquire Atlas in an all-cash transaction for $10.9 billion.

Illustration; Image by Offshore Energy

The deal is being struck on the back of an increased offer the consortium, composed of David L. Sokol, Chairman of the Board of Directors of Atlas Corp., affiliates of Fairfax Financial Holdings, the Washington Family, and Ocean Network Express (ONE), made back in September.

The bidders said at the time that the acquisition would provide the company with greater financial security at a time of deteriorating financial markets and share value drops in the container shipping market.

Furthermore, the consortium believes that the deal would provide Atlas greater stability as the company embarks upon substantial capital investment in making its fleet compliant with the IMO’s regulations.

We reaffirm our belief that Atlas would be able to navigate the industry headwinds (charter rate decline, record vessel deliveries, and impending investments) more nimbly as a private platform, with greater stability and scale through the addition of ONE as a strategic shareholder and partner,” the consortium said.

Under the terms of the agreement, Poseidon will acquire all outstanding common shares of Atlas not owned by Fairfax, Washington and Mr. Sokol for $15.50 per share in cash. The trio currently owns approximately 68% of the outstanding common shares.

“We are pleased to have reached this agreement which, through the combination with Poseidon, introduces Atlas to an important corporate sponsor in the form of ONE,” said Nicholas Pitts-Tucker, Chair of the Special Committee of the Board of Atlas.

“The agreement also provides Atlas’ minority shareholders with a certain cash outcome due to be paid on closing, subject to the approval of a majority of the minority shareholders.”

“Atlas has continued to develop its long-term strategic partnerships and differentiated business model to position the company for sustainable and quality growth. We believe this transaction with Poseidon is an exciting culmination of those efforts for our shareholders,” said Bing Chen, President and CEO Atlas Corp.

“I look forward to continuing to work with David and the rest of the Atlas team as we continue our progress, including preparing for the launch of our new vessel fleet, which we expect to be fully delivered by 2024.”

The transaction is expected to close in the first half of 2023, subject to approval by shareholders holders and regulatory approvals.

Upon the closing of the transaction, Atlas common shares will cease trading on the New York Stock Exchange. Atlas preferred shares will continue trading on the NYSE under current terms.

Following the completion of the transaction, Washington and Fairfax will own a majority of the equity of Atlas. Mr. Chen will continue to serve as President and CEO of Atlas and will contribute his equity in Atlas to become an owner of the company along with Poseidon.

Seaspan’s operating fleet consists of 127 vessels with a total capacity of 1.1 million TEU and an additional 63 vessels under construction. With the latest contract termination for four LNG-powered newbuilds, these now include 25 LNG-fuelled vessels.