July 5, 2018 / 2:08 PM / 10 months ago

UPDATE 1-Aegean Marine shares soar as Mercuria provides $1 bln lifeline

(Adds Mercuria comment, more detail)

LONDON, July 5 (Reuters) - Energy trader Mercuria Group has agreed to provide a $1 billion trade finance facility to Greece’s Aegean Marine Petroleum Network, the marine fuel logistics and supplies company said on Thursday, sending Aegean’s stock up more than 150 percent.

New York-listed Aegean Marine underwent a major leadership change this year after losses prompted an activist investor revolt to sever ties with the company founder, shipping and oil tycoon Dimitris Melissanidis.

Aegean announced a $200 million write-off in early June after a new chairman, Donald Moore, was appointed in May to lead a strategic review.

Shares in Aegean were up 127 percent at $1.43 as of 1359 GMT, having risen as high as $1.53.

Swiss-based Mercuria will initially inject at least $30 million in cash, Aegean Marine said.

Aegean Marine also said the two companies would explore “a potential broader strategic partnership between the company and Mercuria, including operational services, trading and hedging arrangements”.

Upon closing of the trade finance facility, the company will issue new shares equal to 30 percent of its common stock on a pro-forma basis to Mercuria and will invite a representative of Mercuria to join the company’s board of directors.

The trading house has been building a structured trade finance division over the past two years.

It has recently done deals with North Sea producers EnQuest and Tailwind Energy as well as Indonesia’s Ramba Energy and Toronto-listed TransGlobe Energy to support their Egyptian assets.

The firm also provided a lifeline to troubled Noble Group last year with about $400 million of credit.

“We look forward to further developing our relationship with Aegean and providing the flexibility to execute a strategy that enhances the company’s operations and positions the company for long-term success,” Magid Shenouda, Mercuria’s global head of trading, said.

Mercuria did not provide further detail. (Reporting by Julia Payne; Editing by Dale Hudson and David Evans)

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