SCHEDULE: Hafnia Acquires 13.97% Stake in TORM, Eyes Merger

Hafnia Limited has acquired a significant 13.97% stake in TORM plc for $311.4 million, signaling potential strategic consolidation in the tanker industry.

Summary

• Hafnia Limited purchased 14,156,061 Class A common shares of TORM plc.
• The acquisition represents approximately 13.97% of TORM's outstanding Class A shares.
• Total cash consideration for the purchase was $311,433,342, at a price of $22.00 per share.
• The closing of the purchase occurred on December 22, 2025.
• Hafnia acquired the shares for investment purposes, believing consolidation is positive for the tanker industry and shareholders of both companies.
• Hafnia is evaluating potential strategic opportunities, including a combination of the two businesses.
• Hafnia plans to approach TORM's board to discuss its investment and may present formal or informal proposals.

Sentiment

Score: 8

Explanation: The filing indicates a significant strategic investment by Hafnia in TORM, with clear intent for potential business combination and industry consolidation. This is a strong positive signal for Hafnia's strategic growth and potentially for TORM's valuation, despite inherent risks in M&A.

Positives

• Hafnia's acquisition of a significant stake in TORM plc for strategic investment purposes.
• Belief that consolidation is positive for the tanker industry and shareholders of both Hafnia and TORM.
• Evaluation of potential strategic opportunities, including a combination of the two businesses, which could lead to significant synergies.
• All closing conditions for the purchase were satisfied or waived as of December 18, 2025, indicating a smooth transaction.

Risks

• Potential for Regulatory Remedy Actions (divestments, disposals, conditions) by Relevant Authorities that could have a Material Adverse Effect (value exceeding US$100,000,000) on the Purchaser Group, which Hafnia is not obliged to accept.
• Uncertainty regarding the outcome of potential strategic opportunities and business combination proposals.
• Risk that TORM's board or other shareholders may not agree to Hafnia's strategic proposals.

Future Outlook

Hafnia is evaluating potential strategic opportunities involving its investment in TORM plc, including a range of potential options for a combination of the two businesses. It anticipates approaching TORM's board to discuss its investment and may present informal or formal proposals, continuously evaluating TORM's business, prospects, potential synergies, relative net asset value, and the potential use of Hafnia's shares as consideration in a business combination.

Management Comments

• "The Reporting Person believes consolidation is positive for the tanker industry generally and for the shareholders of both Hafnia and the Issuer."
• "The Reporting Person is evaluating potential strategic opportunities involving its investment in the Issuer, including a range of potential options for a combination of the two businesses."
• "The Reporting Person anticipates approaching the Issuer's board of directors to discuss its investment in the Issuer and may as part of this process present informal or formal proposals."
• "The Reporting Person expects to continuously evaluate (i) the Issuer's business and prospects, including identifying and quantifying synergies from a potential business combination transaction which the Reporting Person believes could be significant, (ii) the relative net asset value of the Reporting Person and the Issuer, (iii) the potential use of the Reporting Person's shares as consideration in a potential business combination transaction, and (iv) any other factors the Reporting Person, from time to time, considers relevant in determining whether, if at all, a business combination transaction will be proposed by the Reporting Person or its affiliates."

Industry Context

Hafnia, one of the world's largest operators of chemical and product tankers, views this acquisition as a step towards consolidation in the tanker industry. This move aligns with broader trends in the shipping sector where larger players seek to achieve economies of scale, optimize fleets, and enhance market positioning through strategic mergers and acquisitions, especially in fragmented segments like product and chemical tankers.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders (TORM plc): Potential for increased share value due to strategic investment and potential business combination, but also uncertainty regarding the terms of any future merger.
• Shareholders (Hafnia Ltd): Potential for long-term value creation through industry consolidation and synergies from a combined entity.
• Management (TORM plc): The appointment of a new independent Chairman, and potential future strategic proposals from Hafnia, could lead to significant changes in strategic direction and management structure.
• Employees (TORM plc & Hafnia Ltd): A potential business combination could lead to integration efforts, which may impact roles and organizational structure.
• Customers & Suppliers (TORM plc & Hafnia Ltd): A larger, combined entity could offer enhanced service capabilities or altered supply chain dynamics.

Next Steps

• Hafnia will continuously evaluate TORM's business and prospects, including identifying and quantifying synergies from a potential business combination.
• Hafnia will evaluate the relative net asset value of Hafnia and TORM.
• Hafnia will evaluate the potential use of its shares as consideration in a potential business combination transaction.
• Hafnia anticipates approaching TORM's board of directors to discuss its investment and may present informal or formal proposals.
• Hafnia may hold discussions with or make proposals to other shareholders of TORM or third parties regarding strategic opportunities.
• Hafnia may acquire additional Class A Shares or sell existing ones in the open market, privately negotiated transactions, or otherwise.

Key Dates

Recommendation

Hafnia's acquisition of a substantial 13.97% stake in TORM plc, coupled with its explicit intent to explore a business combination, signals a strong strategic move towards consolidation in the tanker industry. This type of strategic investment by a major industry player often precedes a full merger or acquisition, which typically results in a significant premium for the target company's shares. The stated belief that consolidation is positive for both companies' shareholders and the potential for 'significant' synergies further underpins a positive outlook. While M&A carries inherent risks, the clear strategic intent and the size of the initial stake make TORM plc an attractive 'strong buy' candidate for investors seeking M&A-driven upside.

Keywords

Hafnia Limited, TORM plc, Schedule 13D, Tanker Industry, Strategic Investment, Merger, Acquisition, Consolidation, Shipping, Product Tankers, Chemical Tankers, Share Purchase