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Marine Log

AH 12

July 10, 2008

DOF splashes out

Busy times at Norway's DOF ASA and DOF Subsea ASA.

Today, besides fitting in a naming ceremony for DOF Subsea's latest construction vessel, the company announced a major new order for anchor handlers at Aker Yards and revealed plans to raise the capital needed to enable DOF and DOF Subsea to pursue their growth strategies and to consolidate and strengthen DOF's position in Brazil.

A major part of the cash raising exercise will see DOF and an undisclosed financial partner make an offer to acquire all the outstanding shares in DOF Subsea ASA (DOFSUB).

DOF Subsea currently owns the largest fleet of construction vessels (including newbuildings) in the world--and just yesterday took delivery of another from Aker Yards.

DOF is currently the majority owner of DOFSUB holding, directly and indirectly, 57.05% of the share capital.

The bottom line of the deal with the mystery financial partner is that DOFSUB would be delisted, DOF's stake would be reduced to 50% and DOF would get NOK 380 million in cash.

If the offer is successful, DOF and the financial partner, intend to own DOFSUB on a 50/50 basis through the holding company and to enter into several subsequent transactions that will see a number of other DOF assets transferred to the new holding company.

Separately, and subject to successful completion of the offer for DOFSUB, the financial partner will subscribe for new shares in Norskan AS, a 100% owned subsidiary of DOF, which will give the financial partner a 25% ownership in Norskan AS. This is expected to raise new equity capital of approximately NOK 600 million in Norskan.

Norskan AS is the holding company of the Norskan Offshore group which will own and operate a total fleet of nine offshore vessels in Brazil. The financial partner will commit to its pro rata share in relation to its intended ownership in DOFSUB of up to $400 million for expansion capital expenditures and acquisition opportunities.

Mons Aase, CEO of DOF, says: "The proposed transactions will provide DOF and DOF Subsea sufficient capital to pursue their growth strategies and enable us to consolidate and strengthening our position in Brazil. As a result of the envisaged growth of our Brazilian operations, we will also consider a potential IPO of our Brazilian business in Brazil. We are of the opinion that the intended offer to acquire the shares in DOF Subsea at NOK 45 per share represents an attractive offer to the DOF Subsea shareholders."

Meantime, DOF's latest newbuilding contract with Aker Yards is for three Anchor Handling Tug Supply vessels (AHTS). All the vessels will be of Aker Yards' own design and equipped for operations in the Brazilian market. The three ships are scheduled for delivery at the end of 2010, mid 2011 and towards the end of 2011 respectively.

Aker Yards Project in Alesund has developed the designs, and the vessels will be built at Aker Yards in Brazil.

Two of the vessels will be Aker Yards AH 12 design with a focus on safe operations and stability. They will be outfitted with the latest equipment for safe AHTS operations, such as the largest AHTS winches, cargorail cranes with manipulators, and new systems for handling rig anchors at stern.

The 300 t bollard pull AH 12 has a length OA of approx. 95.0 m, length BP of approx. 84.8 m a molded breadth of. 24.0 m and a speed of approx. 17 knots.

The vessels will be provided with a hybrid propulsion system, combining a well proven conventional diesel engines, direct driven reduction gearboxes and CP propellers with a diesel electric system. Each of the vessels will have accommodations for 60 persons.

The third vessel is of Aker Yards 147 t bollard pull AH 05 design, and is 74 m in length with a beam of 17 meters and speed of 12 knots.

Meantime, Aker Yards yesterday delivered a 157 m long by 27 m beam OSCV 06 L advanced Subsea Construction Vessel, the Skandi Acergy, to DOF Subsea.

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