The board of Stamford shipping company Dorian LPG has unanimously rejected an unsolicited, conditional $1.1 billion acquisition proposal from one of the world”™s largest liquefied petroleum gas (LPG) shippers, Norway”™s BW LPG.
In explaining its decision, Dorian”™s board said the BW LPG proposal presented late last month undervalued Dorian on both an absolute- and relative-value basis. Dorian Chairman, President and CEO John Hadjipateras further outlined the board”™s rejection in a letter to BW LPG Chairman Andreas Sohmen-Pao, which maintained that the offer:
- Failed to recognize the value of Dorian’s “younger, more fuel-efficient ships”;
- Failed to recognize Dorian’s “superior commercial performance”;
- Forced shareholders to accept equity in a more highly leveraged combined company; and
- Proposed a dual listing “that is unlikely to benefit Dorian shareholders.”
Nevertheless, Hadjipateras added that Dorian”™s board was interested in discussing the acquisition or consolidation of some or all of BW LPG”™s 17 eco-ships – vessels that promise reduced fuel consumption and various other energy-efficient features.
“We believe that such a proposal would allow for a more transparent relative valuation and could be concluded relatively expeditiously,” Hadjipateras wrote.
Dorian further announced that it had retained Evercore as financial adviser and Wachtell, Lipton, Rosen & Katz and Seward & Kissel LLP as legal advisers in connection with the proposal.
