Fairstar management resisting Dockwise advances until the bitter end

According to a release from the company, Dockwise (OSE: DOCK) has now through its subsidiary Dockwise White Marlin B.V. managed to attain a sufficient amount of the shares of its competitor Fairstar Heavy Transport N.V. (OSE: FAIR) to be able to forcefully combine the companies. The latest of those were attained through open market purchases apparently somewhat above the earlier offer price. Fairstar’s Board of Directors was constantly saying they felt the bid was undervaluing the company and were doing all in their power to get shareholders more value. This was supported by certain outside opinions. The background here is that Fairstar had recently been winning contracts from the larger Dockwise at higher rates, which prompted the takeover.

After it seemed that once the dust is cleared, Dockwise would get its way, another bizarre twist occurred. Fairstar announced it is contemplating a 335 million USD private placement, the proceeds of which would go into refinancing debt, instalment of a planned fifth vessel, 48,000DWT semi-submersible FATHOM and other corporate purposes. Dockwise took exception to that and has requested a court date to suspend the management of Fairstar. Dockwise says that it is yet to gain information sharing on contracts, fleet completion and financing arrangements. Furthermore Fairstar employees job security, and perhaps more importantly for this matter exit arrangement for Fairstar management remain undecided.

Dockwise says the planned private placement announcement was done without consulting it at all and that Fairstar management continues to act against the interest of Fairstar, the Fairstar – Dockwise combination and its shareholders and stakeholders. It indicated it is unlikely to agree on such a plan and certainly not a decision on another heavy transport vessel at this point. It also says it is willing to buy the Fairstar bonds from bondholders. Fairstar has not explicitly said how big of a majority Dockwise now has, although it has earlier doubted numbers Dockwise has publicly disclosed. It also said on Thursday that it has retained Imperial Capital, LLC as a financial advisor related to the related to the recent purchase by Dockwise White Marlin B.V. of over 33% of Fairstar’s outstanding shares.