Overseas Shipholding Group Confirms Receipt of Unsolicited Indication of Interest

Rhea-AI Summary

Overseas Shipholding Group, Inc. (OSG) has received an unsolicited non-binding indication of interest from Saltchuk Resources, Inc. for the acquisition of all outstanding shares not already owned for $6.25 per share in cash. OSG's Board of Directors is evaluating the offer, emphasizing that stockholders do not need to take any action at this time. The company has not made any decisions regarding the response to the indication of interest, and there is no assurance that a definitive proposal will be made or accepted.

Insights

Financial Analyst

From a financial perspective, Saltchuk Resources, Inc.'s unsolicited bid for Overseas Shipholding Group, Inc. (OSG) at $6.25 per share represents a strategic move within the energy transportation sector. The offer price should be scrutinized in the context of OSG's current financial health, historical stock performance and industry valuation multiples. Investors will be interested in the premium that the offer represents over the current and historical trading prices of OSG's shares.

Moreover, the potential acquisition could lead to operational synergies, cost savings and an enhanced market position for the combined entity. However, the deal's impact on OSG's financials will depend on the ability to realize these synergies. The transaction could also affect the competitive dynamics in the U.S. Flag markets for liquid bulk transportation, with implications for market pricing and service offerings.

It is also important to consider the liquidity implications for OSG stockholders. A cash acquisition provides immediate liquidity, but it also caps the future upside potential for shareholders if the industry or OSG's business prospects improve post-acquisition. The financial analysis should also consider the funding structure of the offer and its implications for the balance sheets of both companies.

Market Research Analyst

The unsolicited bid for OSG by Saltchuk can be seen as indicative of consolidation trends within the energy transportation industry. Given the cyclical nature of the shipping industry and the current market conditions influenced by fluctuating oil prices, geopolitical tensions and environmental regulations, such consolidation moves are not uncommon. A market research perspective would involve analyzing the potential strategic fit of OSG within Saltchuk's portfolio, examining how the acquisition aligns with industry trends and assessing the potential for market share growth.

Understanding the customer base and service overlap between OSG and Saltchuk will be crucial in evaluating the potential benefits of the deal. Additionally, the impact on stakeholders, including employees, customers and suppliers, needs to be considered, as these groups can significantly influence the success of the post-merger integration process.

Legal Expert

From a legal standpoint, the unsolicited nature of the bid by Saltchuk raises questions about the potential for a hostile takeover, although the language used suggests a non-binding and preliminary expression of interest. The legal analysis would focus on the fiduciary duties of OSG's Board of Directors to act in the best interest of all shareholders. This includes a thorough examination of the offer, consideration of alternative options and the negotiation of the best possible terms.

Furthermore, any potential acquisition would be subject to regulatory scrutiny, including antitrust considerations and compliance with maritime laws specific to the U.S. Flag markets. The due diligence process will involve a detailed review of contractual obligations, potential liabilities and the legal ramifications of integrating the two entities. The legal team will also be crucial in drafting any definitive agreement, ensuring it protects the interests of OSG and its shareholders while complying with all necessary legal and regulatory requirements.

TAMPA, Fla.--(BUSINESS WIRE)-- Overseas Shipholding Group, Inc. (the “Company” or “OSG”) (NYSE: OSG), a leading provider of liquid bulk transportation services in the energy industry for crude oil and petroleum products primarily in the U.S. Flag markets, today confirmed that OSG’s Board of Directors received an unsolicited non-binding indication of interest from Saltchuk Resources, Inc. (“Saltchuk”) for the acquisition of all of the outstanding shares of the Company that Saltchuk does not already own for $6.25 per share in cash.

OSG’s Board of Directors is committed to acting in the best interests of all stockholders. Consistent with its fiduciary duties, OSG’s Board of Directors will be carefully considering and evaluating, in consultation with its financial and legal advisors, this indication of interest in due course. OSG stockholders do not need to take any action at this time. OSG cautions its stockholders and others considering trading in its securities that it has just received Saltchuk's unsolicited indication of interest, and no decisions have been made by the Board of Directors with respect to the Company’s response to the indication of interest. There can be no assurance that any definitive proposal will be made or accepted, that any agreement will be executed or that any transaction will be consummated.

The Company does not intend to comment further on the unsolicited indication of interest or any related matters until its Board of Directors has determined that disclosure is necessary or appropriate.

About Overseas Shipholding Group, Inc.

Overseas Shipholding Group, Inc. (NYSE: OSG) is a publicly traded company providing liquid bulk transportation services for crude oil and petroleum products in the U.S. Flag markets. OSG’s U.S. Flag fleet consists of Suezmax crude oil tankers doing business in Alaska, conventional and lightering ATBs, shuttle and conventional MR tankers, and non-Jones Act MR tankers that participate in the U.S. Tanker Security Program.

OSG is committed to setting high standards of excellence for its quality, safety and environmental programs. OSG is recognized as one of the world’s most customer-focused marine transportation companies and is headquartered in Tampa, FL. More information is available at www.osg.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, the Company may make or approve certain forward-looking statements in future filings with the Securities and Exchange Commission (“SEC”), in press releases, or in oral or written presentations by representatives of the Company. All statements other than statements of historical fact should be considered forward-looking statements. These matters or statements may relate to our prospects, supply and demand for vessels in the markets in which we operate and the impact on market rates and vessel earnings, the continued stability of our niche businesses, the impact of our time charter contracts on our future financial performance, external events including geopolitical conflicts such as the Russia/Ukraine conflict and recent developments in the Middle East, and Saltchuk's unsolicited indication of interest and related matters. Forward-looking statements are based on our current plans, estimates, projections and events, and are subject to change based on a number of factors. Accordingly, there are or will be important factors, many of which are beyond the control of the Company, that could cause the Company’s actual results or outcomes, or the timing of certain events, to differ materially from the expectations expressed or implied in the Company’s forward-looking statements, including uncertainty associated with the announcement of Saltchuk's unsolicited indication of interest, the Board of Directors’ evaluation thereof and related matters. Undue reliance should not be placed on any forward-looking statements and, when reviewing any forward-looking statements, consideration should be given to the risks and factors described in this press release and those outlined in the Company’s filings with the SEC. We do not assume any obligation to update or revise any forward-looking statements except as may be required by applicable law. Forward-looking statements and written and oral forward-looking statements attributable to us or our representatives after the date of this press release are qualified in their entirety by the cautionary statements contained in this press release and in the Company’s reports previously or hereafter filed by us with the SEC.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240129914606/en/

Investor Relations & Media Contact:

Susan Allan, Overseas Shipholding Group, Inc.

(813) 209-0620

sallan@osg.com

Source: Overseas Shipholding Group, Inc.

FAQ

What is the indication of interest OSG received from Saltchuk Resources, Inc.?

OSG received an unsolicited non-binding indication of interest from Saltchuk Resources, Inc. for the acquisition of all outstanding shares not already owned for $6.25 per share in cash.

What is the price offered by Saltchuk for the acquisition of OSG's outstanding shares?

Saltchuk offered $6.25 per share in cash for the acquisition of OSG's outstanding shares.

Do OSG stockholders need to take any action at this time?

OSG's Board of Directors emphasized that stockholders do not need to take any action at this time.

Has OSG made any decisions regarding the response to the indication of interest from Saltchuk?

OSG has not made any decisions regarding the response to the indication of interest from Saltchuk.

Is there any assurance that a definitive proposal will be made or accepted by OSG?

There is no assurance that a definitive proposal will be made or accepted by OSG.