September 20, 2004

Stelmar to be acquired by Fortress

Stelmar Shipping Ltd. (NYSE: SJH) today announced that its Board of Directors has unanimously approved a definitive agreement for Stelmar to be acquired by affiliates of Fortress Investment Group LLC (collectively "Fortress") in a merger transaction for $38.55 per share in cash. The total value of the transaction is approximately $677 million in cash.

The pric eis 55% over the closing price of Stelmar's common stock on May 14, 2004, the last trading day prior to the announcement by OMI Corporation of a proposal for a business combination involving Stelmar, and is 8% over the closing price of Stelmar's common stock on September 17, 2004, the last trading day prior to today's announcement.

Stelmar says the agreement represents the conclusion of its review, announced on June 28, 2004, of strategic alternatives for further enhancing shareholder value.

The merger, which is expected to close during the fourth quarter of 2004, is not conditioned on financing but is subject to approval and authorization by Stelmar shareholders and other customary closing conditions.

Nick Hartley, Chairman of Stelmar, commented "This transaction represents the best opportunity to create significant value for all of our shareholders. As we announced on June 28, Stelmar's Board of Directors authorized its management and financial advisors to review strategic alternatives, including the continued execution of Stelmar's successful stand-alone business strategy as well as a range of other alternatives for further enhancing shareholder value. This transaction represents the culmination of that review. Our management team and all of our employees look forward to continuing to provide the highest level of service to our customers around the world."

Wesley R. Edens, Chief Executive Officer of Fortress, said "We are excited by the opportunity to make a substantial investment in the energy transportation sector. We believe that Stelmar represents a unique combination of a modern, high quality fleet and a highly respected and experienced management team."

Morgan Stanley & Co. Incorporated and Jefferies & Company are serving as financial advisors to Stelmar. Morgan Stanley & Co. Incorporated also provided a fairness opinion to Stelmar in connection with the transaction.

Headquartered in Athens, Greece, Stelmar operates one of the world's largest and most modern Handymax and Panamax tanker fleets with an average age of approximately six years. Stelmar's 41 vessel fleet consists of 24 Handymax, 13 Panamax and four Aframax tankers. The fleet includes two leased Aframax, and nine leased Handymax vessels. On completion of the sale of Stelmar's final single-hull tanker by September 2004, one hundred percent of the fully owned fleet will be double-hull. In addition, four of the leased vessels will be double-hull and the balance will be double-sided.

Fortress Investment Group LLC is a global alternative investment and asset management firm founded in 1998 with approximately $10 billion in equity capital currently under management.

With headquarters in New York, Fortress and its affiliates have offices in London, Rome, Frankfurt and Geneva.

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