Why Frontline Stock Is Soaring While Euronav's Is Plunging Today
Shares of Frontline (NYSE: FRO) had skyrocketed more than 25% by 12:45 p.m. ET on Wednesday, while Euronav's (NYSE: EURN) stock price had plunged more than 15%. Driving the big move in the oil tanker stocks was the termination of their merger agreement.
Frontline has abandoned its bid to acquire rival oil tanker Euronav. The company said in a press release that it no longer plans to pursue a combination with Euronav and has terminated the agreement with that company. The companies had initially agreed to an all-stock deal last July, which would have created the largest publicly traded oil tanker company.
The companies had faced significant opposition to the deal from a key Euronav shareholder. Saverys Group had increased its stake in that company up to around 25% to press it to abandon its merger with Frontline. Saverys wanted Euronav to transition to clean energy and decarbonize the shipping industry instead of becoming an even larger oil tanker company. That stake gave it enough pull to scuttle the deal.
Source Fool.com
