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Nordic American Tankers (NYSE:NAT) Is To Create A New Offshore Supply Vessel Company, Nordic American Offshore Ltd. (NAO). Preliminary Option Agreement For The 7th Vessel Entered Into

Stocks in this article: NAT

HAMILTON, Bermuda, Nov. 2, 2013 (GLOBE NEWSWIRE) -- The project as described in the NAT press release below, announced yesterday, November 1st, has been expanded to seven PSV vessels, including an option for delivery of the 7th vessel during the spring of 2015.  The price for the delivered 6 vessels is about NOK 270 million each - about USD 45 million per unit.  The price for the 7th vessel, if the option is exercised, is the same as for the delivered six vessels. An objective is further expansion for NAO that will be the owner of the vessels.

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Nordic American Tankers (NYSE:NAT) to create a new offshore supply vessel company, Nordic American Offshore Ltd. (NAO) with NAT as Manager. NAT will be operated as before.

Hamilton, Bermuda, November 1, 2013

Nordic American Tankers (NAT) announced today that it is coordinating the establishment of Nordic American Offshore Ltd. (NAO), a new company that plans to purchase, on certain conditions, six platform supply vessels (PSVs).  These ships were built in 2012 and 2013 by the Ulstein Group in Norway. The strategy of NAO is expected to be essentially the same as for NAT with dividend as an important element.

Nordic American Offshore is expected to undertake a private equity placement to finance at least 80% of the acquisition price of these vessels. 20% or less of the cost is expected to be financed via debt. NAT and Ulstein Shipping AS will participate in the private placement with 15%/20% and 5% respectively. The NAT investment is planned to be about $50 million.

The establishment of Nordic American Offshore and the NAT investment in the new company do not in any way constitute a departure from NAT's commitment to a homogenous Suezmax tanker fleet. There will be no change as to how NAT operates its business, including how it determines quarterly dividends from its fleet of Suezmax tankers. Nordic American Offshore will seek listing on the New York Stock Exchange as soon as possible.

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