What are the potential impacts on the credit ratings and financing terms for the combined company?

Credit‑rating outlook

The stock‑for‑stock merger will create a larger, more diversified vessel‑ownership platform with a combined fleet of roughly 250 + dry‑bulk ships and a stronger balance‑sheet after the exchange of equity. Rating agencies will initially treat the deal as a “re‑structuring” of leverage: the combined entity will inherit Golden Ocean’s existing debt (≈ US$1.2 bn) and CMB.TECH’s revolving facilities, but will also gain a higher equity cushion from the share‑exchange. In the short‑run, the rating outlook is likely to be downgraded to “stable‑to‑negative” as agencies assess the integration risk and the near‑term debt‑service profile. However, if the merger delivers the expected synergies—improved vessel utilisation, lower operating costs, and a more predictable cash‑flow stream—the combined company could re‑earn a “stable” or even “positive” outlook within 12‑18 months, especially if it can demonstrate a debt‑to‑EBITDA ratio below the 3.0× threshold that most senior‑rating agencies favour for bulk‑shipping groups.

Financing terms

Because the merged firm will be a larger, single‑asset‑class borrower, it will be priced against a broader set of peers (e.g., Diana, Euronav, and other global dry‑bulk owners). The immediate effect will be tighter covenant structures on any new revolving credit lines: lenders will likely demand higher minimum cash‑flow coverage ratios and may impose a “maintenance‑EBITDA” covenant to guard against a post‑merger dip in earnings. On the bond side, the company can now tap the Euro‑medium‑term note market at a lower spread than either party could have previously—potentially 250–300 bps over senior unsecured Euro‑souverigns versus the 350–400 bps spreads each has been paying on its own issuances. Conversely, the existing senior term loan facilities will be re‑priced upward to reflect the higher aggregate leverage, meaning the cost of existing debt could rise by 30–50 bps until the balance‑sheet is re‑structured.

Trading implications

• Short‑term: Anticipate a modest sell‑off in both CMB.TECH and GOGL as rating agencies issue “downgrade‑watch” notices; this creates a buy‑the‑dip opportunity for long‑term investors who can hold the post‑merger equity at a discount (≈ 5‑7 % below the announced exchange ratio).
  
• Medium‑term: Monitor the issuance of the first post‑merger bond (likely a 5‑yr senior unsecured note). A tightening of spreads would signal market confidence and could trigger a short‑cover rally in the combined stock.
  
• Risk management: Keep a close eye on covenant‑breach alerts and any “negative outlook” rating actions; a breach could force the company to refinance at higher rates, pressuring the equity price. Position accordingly with stop‑losses around the 5‑day moving average to limit exposure to rating‑driven volatility.