I applied a high hull ratio to TIL debt, combined the fleet values and by my calcs the hull ratio covenant MOS would improve dramatically. TNK on a standalone could only sustain another 4%+- decline in ship values where as the combined fleet could sustain a drop of 15%+-; a major improvement.
Post transaction EPS will improve slightly due to the amount of shares issued.
Press release: http://tankerinvestments.com/wp-content/uploads/2017/05/TIL-agrees-to-merge-with-TNK.pdf
Slide show: https://seekingalpha.com/article/4078143-teekay-tankers-tnk-acquires-tanker-investments-slideshow?app=1&auth_param=k8di:1cj0ntg:b520d4d134ae5bd8d94ab87fcefe02ff&uprof=44
See slide 11 for transaction details and combination metrics.
I've added a few more shares yesterday and today. I still consider the risk high due to the lack of visibility for the cycle upturn but the strengthening of the balance sheet is a big plus in my view. My entire thesis depends on an upturn in 2018 so prices could stay ugly for a while.