ANNOUNCEMENT NO. 1 - 2008
24 January 2008
Acquisition of 50% of FR8
A/S Dampskibsselskabet TORM (”TORM”) announces that it has acquired a 50%
equity stake in the shipping company FR8 Holdings Pte. Ltd. (”FR8”) from FR8
Limited, a subsidiary of the international oil trader Projector. The FR8 Group
has offices in Singapore, London and Veracruz in Mexico and employs about 30
staff worldwide. Projector will continue to own its equity interest in FR8.
The purchase price for the 50% equity stake in FR8 amounts to USD 125 million
which reflects the current value of similar shipping companies.
In accordance with TORM's long-term strategy, ”Greater Earning Power”, the
acquisition of FR8 will provide TORM's fleet with access to oil cargoes from
Projector and FR8. In addition, the acquisition will enhance TORM's insight
into the demand parameters influencing the product tanker market.
The FR8 Group controls 25 vessels including 3 LR2 newbuildings for delivery in
2008. The FR8 Group owns 6 modern product tankers, comprising 4 MR and 2 LR1
product tankers. In addition, the FR8 Group has long-term charters on 3 LR2, 4
LR1 and 11 MR product tankers, with purchase options on 3 of these vessels. The
FR8 Group also commercially manages 1 LR2 vessel.
The agreement is subject to merger control approval and execution.
For further information on FR8, please refer to www.fr8.com.
Specification of the expectations for the 2007 result
TORM's expectations for the result before tax, excluding restructuring costs
in connection with the acquisition of OMI, for 2007 are specified to USD
810-820 million. The restructuring costs are ex-pected to amount to
approximately USD 15 million.
Contact A/S Dampskibsselskabet TORM Telephone +45 39 17 92 00
Tuborg Havnevej 18 Klaus Kjærulff, CEO
DK-2900 Hellerup - Denmark Mikael Skov, COO
About TORM
TORM is one of the world's leading carriers of refined oil products as well as
being a significant participant in the dry bulk market. The Company operates a
combined fleet of more than 130 modern vessels, principally through a pooling
cooperation with other respected shipping companies who share TORM's commitment
to safety, environmental responsibility and customer service.
TORM was founded in 1889. The Company conducts business worldwide and is
headquartered in Copenhagen, Denmark. TORM's shares are listed on the
Copenhagen Stock Exchange (ticker TORM) as well as on the NASDAQ (ticker TRMD).
For further information, please visit www.torm.com.
Safe Harbor Forward looking statements
Matters discussed in this release may constitute forward-looking statements.
Forward-looking statements reflect our current views with respect to future
events and financial performance and may 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. The forward-looking statements in this release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, Management's examination of historical operating
trends, data contained in our records and other data available from third
parties. Although TORM believes 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, TORM cannot assure you that it will achieve or
accomplish these expectations, beliefs or projections.
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 and currencies, changes in charter hire rates and
vessel values, changes in demand for “tonne miles” of oil carried by oil
tankers, the effect of changes in OPEC's petroleum production levels and
worldwide oil consumption and storage, changes in demand that may affect
attitudes of time charterers to scheduled and unscheduled dry-docking, changes
in TORM's operating expenses, including bunker prices, dry-docking and
insurance costs, changes in governmental rules and regulations including
requirements for double hull tankers or actions taken by regulatory
authorities, potential liability from pending or future litigation, domestic
and international political conditions, potential disruption of shipping routes
due to accidents and political events or acts by terrorists. Risks and
uncertainties are further described in reports filed by TORM with the US
Securities and Exchange Commission, including the TORM Annual Report on Form
20-F and its reports on Form 6-K.
Forward looking statements are based on management's current evaluation, and
TORM is only under obligation to update and change the listed expectations to
the extent required by law.
