American Shipping Company ASA: New vessel acquisition and new long-term bareboat contract

American Shipping Company ASA: New vessel acquisition and new long-term bareboat contract

12 May 2022 16:42 CEST

12 May 2022

American Shipping ASA ("AMSC" or the "Company") is pleased to announce its
purchase of the offshore construction vessel Normand Maximus from Maximus
Limited, a company controlled by its secured lenders (the "Transaction"). In
conjunction with the Transaction AMSC will enter into a long-term bareboat
agreement with a subsidiary of leading offshore services provider Solstad
Offshore ASA ("Solstad").

Total purchase price for the vessel is about USD 157 million and the Company
expects to take delivery in Q4 2022. AMSC intends to finance the Transaction
through 70% debt and the remaining amount through a combination of cash on hand
and new equity. AMSC has already received indicative debt financing terms and
has strong support from key stakeholders to finance the Transaction.

AMSC CEO, Pål Lothe Magnussen, comments "We are excited about this value
accretive acquisition as it creates significant growth in cash flows and leads
to a substantial increase in annual EBITDA. It also diversifies AMSC's leasing
portfolio and adds additional stable and predictable returns to our
shareholders. We look forward to working together with Solstad as a long-term
tonnage provider going forward. We have for some time been looking for the right
growth opportunity and we are very satisfied with concluding on this
transaction. The Transaction is accretive on all key financial metrics and is
projected to produce more than 20% annual return on equity with strong running
dividend yield. The offshore services market is in recovery and is currently
experiencing increased activity and positive outlook. We believe the timing of
the Transaction is favorable and the risk/reward attractive".

The Normand Maximus is a premier offshore construction vessel and one of the
most modern heavy duty subsea construction vessels globally. The vessel was
built in 2016, has 2600m[2] working deck, accommodation capacity for 180 people
and a carousel for flexible products with about 4000t capacity. Main workscope
is laying flexible pipes and umbilicals and installation of subsea equipment.
Additional workscope in the future includes installation of power cables for the
offshore wind industry.

Solstad is a leading offshore services company with a large fleet of offshore
vessels operating globally. Solstad is the present operator of the Normand
Maximus and will continue to do so under a new bareboat contract with AMSC.

Company contacts:

Pål Magnussen, Chief Executive Officer +47 90 54 59 59

Morten Bakke, Chief Financial Officer +47 900 955 94

Leigh Jaros, Controller +1 484 880 3741

About American Shipping Company ASA:

Established in 2005 and listed on the OSE, AMSC is a ship owning company with
nine modern handy size product tankers and one modern handy size shuttle tanker
on bareboat charter with Overseas Shipholding Group (OSG). OSG charters the
vessels out on time charters to major oil companies in the U.S. coastwise Jones
Act trade. AMSC has a significant contract backlog as well as a profit sharing
agreement with OSG which offers visibility with respect to future earnings and
potential dividend capacity. The Company has an ambition to pay attractive
dividends to its shareholders. Further information is available at
www.americanshippingco.com.

This information is considered to include inside information pursuant to the EU
Market Abuse Regulation article 7 and is subject to the disclosure requirements
pursuant to section 5-12 of the Norwegian Securities Trading Act. This stock
exchange announcement was published by Leigh Jaros, Controller, American
Shipping Company ASA, on May 12, 2022 at 16:40 CET

More information:
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Source

American Shipping Company ASA

Provider

Oslo Børs Newspoint