Hamilton, Bermuda, March 10, 2014 (GLOBE NEWSWIRE) -- Knightsbridge Tankers Limited (Nasdaq: VLCCF) ("Knightsbridge") and Frontline 2012 Ltd. ("Frontline 2012") today announced that they and Karpasia Shipping Inc (Karpasia), a company controlled by a trust established by John Fredriksen for the benefit of his immediate family have agreed for Knightsbridge to acquire five fuel efficient 180,000 DWT Capesize bulk carrier newbuildings from Frontline 2012 and one Capesize bulk carrier built in 2013 from Karpasia. The newbuildings were ordered by Frontline 2012 from Shanghai Waigaoqiao Shipbuilding Company Limited in China and have expected deliveries of between May 2014 and September 2014. Knightsbridge has agreed to pay $61 million for each of the five Capesize newbuildings and $55 million for the Capesize built in 2013. Of the total consideration of $360 million, $186 million will be paid in shares of Knightsbridge at $10 per share, $150 million in absorption of remaining newbuilding capex and $24 million in cash. Accordingly, Knightsbridge has agreed to issue 15.5 million shares to Frontline 2012 and 3.1 million shares to Karpasia, or another company controlled by trusts established by John Fredriksen for the benefit of his immediate family, on closing of the transaction. Knightsbridge will seek to raise around $30 million in bank debt per vessel. The transaction is subject to execution of definitive documentation and normal closing conditions. Following the issuance of the shares, Knightsbridge will have 49.1 million shares outstanding. Knightsbridge expects to have ten Capesizes on the water by the end of September 2014 and in addition four newbuildings delivering in 2015. Knightsbridge's strategic plan is to grow its Capesize fleet and its cash flow per share as the drybulk market recovers. The Knightsbridge Board of Directors will consider acquiring further Capesize vessels from the market as well as from Frontline 2012. Frontline 2012 has further 25 shipbuilding contracts for fuel efficient Capesizes with deliveries expected to take place between Q3 2014 and Q3 2016, distributed with five vessels in 2014, 14 vessels in 2015 and six vessels in 2016.
Commenting on the transaction, Ola Lorentzon, Chief Executive Officer of Knightsbridge, stated: "The purchase by Knightsbridge of the six Capesize vessels will help us in developing the leading New York listed Capesize owner. We believe that acquiring these vessels will greatly benefit our shareholders through additional scale and reduced fleet age and we believe it will increase our opportunity to benefit from a dry bulk market recovery. We will seek to have a moderate debt level per vessel and favorable amortization profile, with the ambition to create a structure that allows for high distribution capacity. Needless to say, it is a major step for the Company."The Chairman of Frontline 2012, John Fredriksen, said: "We are very pleased to be able to enter into a transaction with Knightsbridge, which is in line with our strategic plan of creating pure plays in different shipping segments through consolidation, divestments and spin offs." FORWARD LOOKING STATEMENTS Matters discussed in this report may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements, which include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. Knightsbridge Tankers Limited and its subsidiaries, or the Company, desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. This report and any other written or oral statements made by us or on our behalf may include forward-looking statements, which reflect our current views with respect to future events and financial performance. The words "believe," "anticipate," "intend," "estimate," "forecast," "project," "plan," "potential," "will," "may," "should," "expect" and similar expressions identify forward-looking statements. The forward-looking statements in this report are based upon various assumptions, including, without limitation, management's examination of historical operating trends, data contained in our records and data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
In addition to these important factors and matters discussed elsewhere herein and in the documents incorporated by reference herein, important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies, fluctuations in currencies and interest rates, general market conditions, including fluctuations in charter hire rates and vessel values, changes in demand in the dry bulk market, changes in the Company's operating expenses, including bunker prices, drydocking and insurance costs, the market for the Company's vessels, availability of financing and refinancing, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents, political events or acts by terrorists, and other important factors described from time to time in the reports filed by the Company with the Securities and Exchange Commission, or the Commission.
|The Board of Directors|
|Knightsbridge Tankers Limited|
|March 10, 2014|