August 23, 2019 / 7:12 AM / a month ago

Frontline buys 10 oil tankers from Trafigura for $675 mln

OSLO, Aug 23 (Reuters) - Frontline will buy 10 Suezmax oil tankers from Trafigura in a cash and share deal worth up to $675 million, and may buy a further four vessels later, the two companies announced on Friday.

The deal will allow Frontline, which is controlled by Norwegian-born billionaire John Fredriksen, to boost its dividend in the time to come, the Oslo-listed tanker operator said.

“The structure of the transaction creates an immediate impact to our earnings at a time when we expect freight rates to increase significantly,” Frontline Chief Executive Robert Hvide Macleod said in a statement.

Trafigura will take an 8.5% stake in Frontline, valued at $128 million, and will receive a cash payment of between $538 million and $547 million.

The vessels were all built in 2019 and have been fitted with exhaust gas cleaning systems. (Reporting by Terje Solsvik, editing by Gwladys Fouche)

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