Thursday, January 27, 2000

Battle for NCL heats up
Carnival Corporation today confirmed that it has indicated to Kristian Siem, chairman of NCLHolding ASA, that if the board can deliver a controlling interest in NCL, Carnival is willing to pay NOK 40 per share subject to customary terms and closing conditions including clearance of Hart-Scott-Rodino.

According to Howard Frank, vice chairman and chief operating officer of Carnival Corporation, Siem has indicated that, based on the facts as they exist today, he would recommend acceptance of the Carnival offer to the NCL board. "If we are successful, we believe that the transaction, which represents a 19% increase to the enterprise value of our previous bid, is still attractive and in Carnival's and NCL's best interest,'' Frank said.

In December last year, Carnival made an uninvited NOK 30 a share offer for NCL. Howver, it let its tender offer expire on December 22, after news that Singapore-listed Star Cruises, which is making a NOK 35 per share offer, had acquired a substantial holding in NCL.

Star is believed to hold just short of 50% of NCL's stock, but earlier this week came news that the NCL board was seeking a mandate to issue 120 million new shares at a price of at least NOK 35 crowns per share, the company said in a statement to the Oslo bourse.

With NCL's share price heading higher, several insiders have exercised options as follows:

   No. of shares  Price
Lamarr Cooler, Ex.VP/CFO  221,940  NOK 23.89
Svenn Dahl, Ex. VP Cruise Operations 201,940  NOK 23.84 
David Gubbay, Ex. VP Corporate Project 150,000  NOK 21,15 
Robert Kritzman, Senior VP General Counsel 208,100  NOK 23.85 
Art Sbarsky, Ex. VP Markt. & Sales 147,000  NOK 27.41 
Brian Stevenson, Ex. VP Corp. Develop.  125,000 NOK 20.69 

BT Shipping sheds old panamax tankers
BT Shipping Limited reportedly expects to enter into an agreement to sell its four oldest Panamax Tankers to Sea Oil Shipping Ltd. for $16.5 million en -bloc. The vessels to be included in the include the BT Nimrod (built 1978). The transaction is likely to be completed within the first quarter. BT Shipping will give Sea Oil a 25%
Sellers´ Credit, which is repayable over four years and have a second priority mortgage on the vessels and their income. Part of the proceeds from the sale will be utilized to repay the $11.4 million outstandingmortgage debt on the vessels.

Ugland to sell vehicle carrier interests
Ugland International Holdings plc (UIH) is to sell its vehicle carrier operations to its joint venture partner, Leif Höegh& Co. ASA (LHC). Ugland's vehicle carrier interests comprise its ownership of 50 per cent. of HUAL AS ("HUAL"), and 50 per cent. of Joint Vessels Limited ("JVL") and its fleet of seven vehicle carrier vessels .

In consideration for the sale to it of the HUAL Interests, LHC will pay a cash sum of $238 million for the 50 per cent. of HUAL and the 50 per cent. of JVL it does not already own, together with UIH's seven vehicle carrier vessels. LHC will also assume UIH's share, currently amounting to approximately $64 million, of the net debt in JVL.

In addition, LHC will assume the majority of UIH's obligations in relation to two car carrier new buildings in respect of which UIH has signed bareboat charters, each of which runs for an initial term of six years from delivery. Under these arrangements LHC will time charter from UIH each vessel at a daily rate of $18,000 for similar periods to those of UIH's bareboat charters. The net present value of the charter obligations
being assumed by LHC is approximately $87 million. UIH will continue to charter these vessels under existing financing arrangements.

Ugland says it has long held the view that the development of HUAL and its value to its shareholders has been held back by joint ownership and that HUAL's interests would be better served by it having a single owner. From early 1999, Ugland and Höegh have explored the possibility of Uglandselling the HUAL Interests to Höegh or, alternatively, Höegh selling its vehicle carrier interests to Ugland. However, during the course of these negotiations, Ugland's share price fell to a level which, by the end of November 1999 meant that, in the opinion of the Ugland board, it would not have been in the interests of shareholders to raise the equity necessary to proceed with a possible purchase of Höegh's vehicle carrier interests.

On December 3, 1999 a final proposal from Höegh to purchase the Ugland's HUAL interests was rejected by the board and the formal negotiations were terminated.

Andreas O. Ugland, Ugland's non-executive chairman, informed the board that, following the termination of the negotiations he entered into a conditional agreement to purchase the 17,144,420 ordinary shares in Ugland owned by Saltchuk Resources, Inc. ("Saltchuk"), representing approximately 12.8 per cent. of UIH's issued share capital, at a price of 63 pence per share (the "Saltchuk Shares").Ugland director Michael D. Garveyhas a majority holding in Saltchuk .

Under the articles of association of Ugland International Holdings plc , Andreas O. Ugland's deal with Saltchuk, when completed, would require him to make an offer for the remaining share capital of UIH. The agreement with Saltchuk is conditional on Andreas O. Ugland raising the finance necessary to make such an offer.

Soon after the announcement of the Saltchuk agreement , Lohit Limited, an investment vehicle controlled by Mr Leif Höegh acquired in the market a significant shareholding in UIH. The current holding of Lohit Limited and entities associated with it is thought to amounts to approximately 12.3 per cent. of UIH's issued share capital.

Subsequent to these purchases, LHC initiated new discussions which led to a price being agreed for the sale by UIH of the HUAL Interests to LHC on the terms announced today. These terms represent a significant improvement on the proposal which was rejected on 3 December 1999.

UIH is obliged, under the terms of the agreements governing the HUAL partnership, to offer its assets in that partnership firstly to LHC, thus precluding their sale (without LHC's approval) to a third party. The Company has evaluated the joint venture with LHC against the background of this restriction and in the light of the current trading noted above. The board considers that the agreement reached with LHC represents a better option for the company than continuing with the present arrangements.

The proposed sale of the HUAL Interests, when completed, will result in the disposal of UIH's principal business and will result in the company having substantial net cash balances. In the light of the potential offer from Andreas O. Ugland referred to in the appendix, the independent directors of the Company have not yet formally considered the application of the sale proceeds. In the event of such an offer being made, the independent directors will consider its merits, and make their views known to shareholders thereafter.

Litton Ingalls, Lucent announce agreement to develop high-tech apps for the US Navy
Litton Ingalls Shipbuilding, a division of Litton Industries and Lucent Technologies
yesterday announced an agreement to develop "breakthrough communications technology applications" for U.S.
Navy ships. Under the agreement, Ingalls will provide expertise in robotics, advanced ship design and production, and design and fabrication using advanced materials. Lucent will provide expertise in communications and data networking, as well as wireless, optical and Internet technologies.

"Our goal is to work with Ingalls to create 'smart ships,'" said Jim O'Neill, president of Lucent's Government Solutions business. "Cutting-edge technologies from Bell Labs are used routinely to solve the global communications needs of corporations, but those same technologies also hold great potential for shipboard use. They can be used to automate ship systems, equipment and displays, and to provide the Navy with ready access to information -- when and where it's needed."

"We're looking forward to providing a showcase for high-tech solutions that improve a ship's mission capability," added Pat Keene, president of Litton Ingalls. "Conditions at sea can present unusual demands on technology. But we intend to use Ingalls' experience in design and manufacturing to demonstrate that it is possible to routinely use leading-edge technologies at sea. As the Navy moves to 'Knowledge-Centric' technology, Ingalls will be ready."



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