Namely, the National Shipping Company of Saudi Arabia or NSCSA (Bahri) and Vela, a subsidiary of the world’s largest producer and exporter of oil, Saudi Arabian Oil Company (Aramco), have formed an alliance, which, as explained by Jasser, involves a cash payment of $832.7 million, including the issuance of 7.875 million new shares at SR 22.25 per share. As a result, Aramco will own 20 percent of Bahri shares.
The merger builds on a Memorandum of Understanding (MoU) inked in 2012 and will see creation of a joint fleet.
The deal includes shifting the whole fleet of Vela, consisting of 14 VLCCs used for floating storage, 5 refined petroleum product tankers, all crew of Vela’s carriers, employees and part of its business systems, so that they can be integrated within Bahri’s structure. The first ship transfer is envisaged for the third quarter and the expected last ship transfer will be in the fourth quarter.
As explained by Bahri’s CEO, the agreement provides for a long-term shipping contract, sale of exclusive VLCC crude oil shipping provider to Aramco and a TCE floor and threshold.
Signing of the deal will pave the way for Bahri to become the exclusive maritime carrier of crude oil sold by Saudi Aramco on the basis of delivery to the client by VLLCs, Jasser said.
Bahri is the biggest fleet-owner in the Middle East with 17 VLLCs and a fleet of 24 tankers, which makes it the fourth in the world when speaking about chemical shipments under the National Chemical Carries (NCC) with Saudi Basic Industries Corporation (SABIC) partnership.
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