The European Commission has granted approval for the joint acquisition of France LNG Shipping (FLS) by a consortium including Japanese shipping colossal NYK, French shipowner Geogas Maritime and compatriot infrastrucure fund manager DIF Management, as well as capital market company Marigold, a subsidiary of the Luxemburg-based Access Capital Partners.
As diclosed, the European Commission—which received the notification of the proposed transation on August 21, 2024—announced after a ‘thorough’ review that the transaction would not disrupt competition in the European market for liquefied natural gas (LNG) shipping, clearing the path for the deal to move forward under the EU’s simplified merger control framework—typically applied when no substantial market dominance is expected.
The parties involved will now share control over FLS, which, according to the companies, would further strengthen their positions in the LNG shipping market.
As per the EU Agency for the Cooperation of Energy Regulators (ACER), LNG has played a vital role in Europe’s energy security, particularly as the continent transitions away from high-emission sources. With a growing demand for reliable and lower-carbon alternatives, LNG has, thus, become an important component of energy diversification strategies.
FLS’ own fleet is said to provide ‘essential’ infrastructure, ensuring an uninterrupted flow of liquefied natural gas across Europe. Within this context, the consolidation of ownership under NYK, Geogas, DIF, and Marigold is expected to facilitate further investments in cleaner technologies and expand the reach of LNG in energy markets.
The consolidation, however, is not the beginning of the collaboration between the shipping heavyweights. NYK and Geogas Maritime have long been building an LNG shipping “platform”, with pecuniary suppport from DIF and Marigold.
Moreover, parties of the consortium, specifically, DIF Management, Geogas Maritime and Access Capital Partners have repeteadly invested in the LNG market through ‘strategic’ acquisitions and collaborations.
Back in 2019, DIF, through its DIF Core Infrastructure Fund I, Geogas Maritime and Access Capital signed the final paperwork for the purchase of a 50% stake in a French company that would own and operate a fleet of five LNG carriers. The remaining half was to be held by NYK.
At that time, the companies informed that the 174,000 cbm vessel quintet would be built by South Korean shipyards and equipped with LNG-fueled propulsion technology, projected to result in enhanced environmental performance.
According to the companies’ statement from 2019, all five of the ships were going to be chartered to a French and a European utility under long-term contracts.