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Grindrod Shipping Holdings Ltd. Announces Entry Into Sale And Purchase Agreements
GRINDROD SHIPPING HOLDINGS LTD.
ABBREVIATED NAME: GRINSHIP
Registered in Singapore with registration number 201731497H
JSE Share code: GSH
ISIN: SG9999019087
Primary listing on NASDAQ Global Select Market
Secondary listing on the JSE Main Board
Grindrod Shipping Holdings Ltd. Announces Entry Into Sale And Purchase Agreements
On 25 September 2023, Grindrod Shipping Holdings Ltd. (NASDAQ: GRIN) (JSE: GSH) (“Grindrod
Shipping” or "Company" or “we” or “us” or “our”), a global provider of maritime transportation services
predominantly in the drybulk sector, announced the entry by Grindrod Shipping Pte. Ltd., a wholly owned subsidiary
of Grindrod Shipping, as buyer, and Grindrod Shipping, as parent, into two sale and purchase agreements (the “Sale
and Purchase Agreements”) to acquire the entire issued share capital of Taylor Maritime Management Limited and
Tamar Ship Management Limited (the “Companies”) from, in the case of Taylor Maritime Management Limited,
Taylor Maritime Group Limited and, in the case of Tamar Ship Management Limited, Taylor Maritime Group Limited
and Temeraire Holding (MI) Limited (together, the “Sellers”) (collectively the “Acquisition”). Following the
Acquisition, the Companies will become wholly owned subsidiaries of Grindrod Shipping. The Acquisition is subject
to certain closing conditions and closing is expected to occur before mid-October 2023.
Under the terms of the transaction, Grindrod Shipping Pte. Ltd. and Island View Ship Management Pte. Ltd.
have agreed to acquire all of the shares of the Companies for a total consideration of approximately US$11.75 million
via (i) a completion cash amount of US$2.0 million (subject to usual working capital and indebtedness adjustments),
(ii) an allotment and issuance of completion consideration shares of approximately US$1.95 million, (iii) an issuance
of consideration shares at the first anniversary of the completion date of up to approximately US$3.9 million (subject
to certain earn-out related conditions), and (iv) an issuance of consideration shares at the second anniversary of the
completion date of up to approximately US$3.9 million (subject to certain earn-out related conditions). The aggregate
maximum value of the consideration for the Acquisition will not exceed US$13.5 million. Grindrod Shipping intends
to finance the transaction with a combination of cash on hand and allotment of new Grindrod Shipping ordinary shares
over the two years from completion. The number of consideration shares issuable is calculated based on the volume
weighted average price on both NASDAQ and the Johannesburg Stock Exchange, plus 7.5 percent premium over a
three month period prior to the date of entry of the Sale and Purchase Agreements. At the discretion of the Board of
Directors, in lieu of new share issuances, there is an option for any portion of the first year and second year
consideration amounts to be paid in cash, at an increase of 1.10 times and 1.20 times, respectively.
The Sale and Purchase Agreements contain customary warranties and covenants of the parties and, in
connection with the Acquisition, each Seller will be subject to limited non-compete and non-solicitation covenants
with regard to Grindrod Shipping and its subsidiaries for two years from the completion date. The closing of the
Acquisition, expected to occur before mid-October 2023 is subject to closing conditions, including, among other
things, the repayment of debts owed by the Companies and their subsidiaries to the Sellers and by the Sellers to the
Companies and their subsidiaries.
It is to be further noted that our Chief Executive Officer, Mr. Edward Buttery, has recused himself from all
deliberations on this Acquisition, as the Companies have a Framework Management Agreement with Taylor Maritime
Investments Ltd. (“TMI”) to act as their Commercial and Technical Manager for TMI’s fleet. In addition, one of our
non-executive directors, Mr. Paul Over, has also recused himself from this Acquisition as he is a non-executive
director of Taylor Maritime (HK) Ltd, which is a subsidiary of Taylor Maritime Group Limited.
Commenting on the Acquisition, Grindrod Shipping Chairman, Dr. Kurt Klemme, said, “We are very pleased
with the acquisition of Tamar Ship Management Limited and Taylor Maritime Management Limited, whose current
operations are aligned with our technical ship-management practice and our commercial strategy. This Acquisition
will further increase our revenue streams in terms of ship-management income, unlock synergies in our commercial
deployment of the dry bulk fleet and we will achieve savings on the technical side with a larger fleet. With the central
management of a combined group fleet, we will certainly achieve better returns to our shareholders.”
About Grindrod Shipping
Grindrod Shipping predominantly owns and operates a diversified fleet of owned and long-term and short-term
chartered-in drybulk vessels. The drybulk business, which operates under the brand “Island View Shipping” (“IVS”)
includes a core fleet of handysize and supramax/ultramax drybulk carriers. The Company is based in Singapore, with
offices in London, Durban, Tokyo and Rotterdam. Grindrod Shipping is listed on NASDAQ under the ticker “GRIN”
and on the JSE under the ticker “GSH”.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform
Act 1995 with respect to Grindrod Shipping’s financial condition, results of operations, cash flows, business strategies,
operating efficiencies, competitive position, growth opportunities, plans and objectives of management, and other
matters. These forward-looking statements, including, among others, those relating to our future business prospects,
revenues and income, are necessarily estimates and involve a number of risks and uncertainties that could cause actual
results to differ materially from those suggested by the forward-looking statements. Accordingly, these forward-
looking statements should be considered in light of various important factors, including those set forth below. Words
such as “may,” “expects,” “intends,” “plans,” “believes,” “anticipates,” “hopes,” “estimates,” and variations of such
words and similar expressions are intended to identify forward-looking statements. These forward-looking statements
are based on the information available to, and the expectations and assumptions deemed reasonable by Grindrod
Shipping at the time these statements were made. Although Grindrod Shipping believes that the expectations reflected
in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to
have been correct. These statements involve known and unknown risks and are based upon a number of assumptions
and estimates which are inherently subject to significant uncertainties and contingencies, many of which are beyond
the control of Grindrod Shipping. Actual results may differ materially from those expressed or implied by such
forward-looking statements. Important factors that could cause actual results to differ materially from estimates or
projections contained in the forward-looking statements include, without limitation, Grindrod Shipping’s future
operating or financial results; the strength of world economies, including, in particular, in China and the rest of the
Asia-Pacific region; the effects of the COVID-19 pandemic on our operations and the demand and trading patterns for
the drybulk market, and the duration of these effects; cyclicality of the drybulk market, including general drybulk
shipping market conditions and trends, including fluctuations in charter hire rates and vessel values; changes in supply
and demand in the drybulk shipping industry, including the market for Grindrod Shipping’s vessels; changes in the
value of Grindrod Shipping’s vessels; changes in Grindrod Shipping’s business strategy and expected capital spending
or operating expenses, including drydocking, surveys, upgrades and insurance costs; competition within the drybulk
industry; seasonal fluctuations within the drybulk industry; Grindrod Shipping’s ability to employ its vessels in the
spot market and its ability to enter into time charters after its current charters expire; general economic conditions and
conditions in the oil and coal industries; Grindrod Shipping’s ability to satisfy the technical, health, safety and
compliance standards of its customers; the failure of counterparties to our contracts to fully perform their obligations
with Grindrod Shipping; Grindrod Shipping’s ability to execute its growth strategy; international political and
economic conditions including additional tariffs imposed by China and the United States; potential disruption of
shipping routes due to weather, accidents, political events, natural disasters or other catastrophic events; vessel
breakdowns; corruption, piracy, military conflicts, political instability and terrorism in locations where we may
operate, including the recent conflicts between Russia and Ukraine and tensions between China and Taiwan;
fluctuations in interest rates and foreign exchange; changes in the costs associated with owning and operating Grindrod
Shipping’s vessels; changes in, and Grindrod Shipping’s compliance with, governmental, tax, environmental, health
and safety regulations including the International Maritime Organization, or IMO 2020, regulations limiting sulfur
content in fuels; potential liability from pending or future litigation; Grindrod Shipping’s ability to procure or have
access to financing, its liquidity and the adequacy of cash flows for its operation; the continued borrowing availability
under Grindrod Shipping’s debt agreements and compliance with the covenants contained therein; Grindrod
Shipping’s ability to fund future capital expenditures and investments in the construction, acquisition and
refurbishment of its vessels; Grindrod Shipping’s dependence on key personnel; Grindrod Shipping’s expectations
regarding the availability of vessel acquisitions and its ability to buy and sell vessels and to charter-in vessels as
planned or at prices we deem satisfactory; adequacy of Grindrod Shipping’s insurance coverage; effects of new
technological innovation and advances in vessel design; and the other factors set out in “Item 3. Key Information-Risk
Factors” in our Annual Report on Form 20-F for the year ended December 31, 2022 filed with the Securities and
Exchange Commission on March 23, 2023. Grindrod Shipping undertakes no obligation to update publicly or release
any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release
or to reflect the occurrence of unanticipated events except as required by law.
Company Contact: Investor Relations / Media Contact:
Deborah Davel
Chief Financial Officer
Grindrod Shipping Holdings Ltd. Grindrod Shipping Holdings Ltd.
1 Temasek Avenue, #10-02 Millenia Tower 1 Temasek Avenue, #10-02 Millenia Tower
Singapore, 039192 Singapore, 039192
Email: ir@grindrodshipping.com Email: ir@grindrodshipping.com
Website: www.grinshipping.com Website: www.grinshipping.com
By order of the Board
26 September 2023
Sponsor: Grindrod Bank Limited
Date: 26-09-2023 08:30:00
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