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October 13, 2005

Double Hull Tankers prices IPO

OSG spin-off Double Hull Tankers, Inc. (NYSE:DHT) announced today that it priced its initial public offering of 16,000,000 shares of common stock at $12.00 per share. The common stock will trade on the New York Stock Exchange under the symbol "DHT."

The size and price of the offering represent a considerable scaling back from the originally planned 20 million shares at $14-16 a share.

DHT says that net proceeds from the sale, after deducting underwriting discounts and commissions and estimated offering expenses, are expected to be approximately $178.2 million. DHT will use all of these net proceeds, together with borrowings of $236 million under its credit facility (before estimated debt issuance costs of approximately $1.6 million) and 13,999,900 shares of its common stock, to acquire from subsidiaries of Overseas Shipholding Group, Inc. ("OSG") a fleet of seven tankers designed to carry crude oil on both long and short haul routes worldwide. The tankers, three very large crude carriers ("VLCCs") and four Aframaxes, are modern, double hull tankers with an average age of 5.4 years. All of the tankers will be chartered to other subsidiaries of OSG for an initial period of five to six and one-half years.

UBS Investment Bank and Merrill Lynch & Co. are serving as joint book-running managers of the offering.

A subsidiary of OSG has granted the underwriters an option to purchase an additional 2,400,000 shares of common stock of DHT at the initial public offering price, less underwriting discounts and commissions payable by it, to cover over-allotments.

Separately, Overseas Shipholding Group, Inc. announced today that it had agreed to sell the seven tankers to Double Hull Tankers, Inc. and said that it will receive $412.6 million in cash and 14 million shares of DHT common stock, representing a 47 percent equity stake in the new tanker concern.

The total proceeds to OSG value the transaction at $580.6 million, net of fees and expenses.

OSG will time charter the vessels from DHT for periods of five to six and one-half years with various renewal options up to an aggregate of five to eight years depending on the vessel. The transaction is immediately accretive to earnings.

OSG says the sale of the vessels underscores its strategy of actively managing the balance between owned and chartered-in vessels in its fleet.

The transaction will help OSG achieve its stated goal of returning to leverage ratios and liquidity levels that existed prior to the early-2005 acquisition of Stelmar Shipping Ltd. for $1.35 billion.

OSG expects to book a gain on the sale and charter back of these vessels in excess of $230 million in the fourth quarter of 2005. The gain will be deferred for accounting purposes and recognized as a reduction of time charter hire expense over the charter periods.

The proceeds of the sale will be used to reduce debt. OSG plans to provide further guidance on the financial impact of the transaction for the fourth quarter and fiscal 2006 when it reports third quarter 2005 earnings on November 3, 2005.