Acquisition of Three New Vessels

Ref: COR:MS/EL07021e/ms

21 September 2007

Subject: Acquisition of Three New Vessels

To: The President of the Stock Exchange of Thailand

Thoresen Thai Agencies Public Company Limited ("TTA") confirms that Thoresen Shipping Singapore Pte. Ltd. ("TSS"), which is a wholly owned subsidiary of TTA, has entered into construction contracts (each, a "Contract") to build three new Handymax vessels. The transaction details are as follows:

1. Date of Transaction:
TSS has signed Contracts to build three new vessels with Vietnam Shipbuilding Industry Group ("Vinashin"). The Contracts are effective on 21 September 2007.

2. The Parties Involved:

3. General Characteristics of the Transaction/Details of the Acquired Assets:
Pursuant to the Contract, TSS has engaged Vinashin in Vietnam to build,equip, and complete three identical 53,000 deadweight tons double-hulled Handymax bulk carriers (the "Vessels"). Upon delivery, the Vessels will be chartered out to increase TTA's profitability.

The three Vessels are expected to be delivered around October 2010, February 2011, and June 2011, respectively.

TSS's present registered and share capital is SGD 27.50 million. It will immediately increase its registered and paid-up capital to SGD 53.60 million and will increase its share capital over time as instalment payments are made according to the Contract terms.

4. Total Value of Consideration:
The total delivered cost of three Vessels (the "Delivery Cost") is US$ 123,796,344 (One Hundred Twenty Three Million Seven Hundred Ninety Six Thousand Three Hundred and Forty Four) which is equivalent to Baht 4,275,925,721.76 (Four Billion Two Hundred Seventy Five Million Nine Hundred Twenty Five Thousand Seven Hundred Twenty One and Seventy Six Satang) using a USD/THB exchange rate of 34.54).

 

Cont. 2.../

 

Payment terms are as follows:

The Delivery Cost includes a number of upgrades to the basic vessel specifications. These upgrades increase the Vessel's durability and enhance its trading capabilities and attractiveness to our client base.

The size of the transaction equals 16.88% of the total assets of TTA and its subsidiaries as of 30 June 2007 (the total assets of TTA and its subsidiaries as of 30 June 2007 amounted to Baht 25,327,855,829).

When these transactions are included with other asset acquisition transactions in the past six months, there has been a 16.88% increase in the total assets of TTA and its subsidiaries as of 30 June 2007. Regulations consider these acquisitions as Class 2 transactions in accordance with the Rules, Procedures, and Disclosure of Information of the Stock Exchange of Thailand ("SET") regarding the Acquisition and Disposition of Assets of Listed Companies. TTA is required to disclose the information immediately and send a circulation to shareholders within 21 days from the date of disclosure to the SET.

5. Basis Used to Determine the Value of Consideration:
The terms and conditions have been agreed on normal commercial terms following arm's length negotiations between the New Vessel Buyer and the New Vessel Builder. The purchase price fairly reflects the current market price of a new Handymax vessel.

6. Benefit Expected to be Generated from the Transaction:
TTA's principal activities include vessel chartering and ownership. The Vessels are Handymax in size. The acquisitions are part of TTA's fleet renewal and expansion strategy, which focuses on reducing our fleet average age and increasing the average size of our vessels to serve the growing needs of our client base.

TTA currently owns forty-five (45) general cargo and dry bulk carriers. Two new build vessels which had been reported to SET are expected to be delivered in December 2009 and September 2011. With this acquisition, TTA will have five new build vessels to be delivered between 2009 and 2011.

 

Cont. 3.../

 

7. Source of Funds:
A majority of the Delivery Cost will be funded by US Dollar loans from our syndicate banks. Operating cash flows will fund the remaining equity portion.

8. Board of Directors' Opinions For The Transactions:
The Board of Directors considers that these terms and conditions are fair and reasonable in the current market situation and in TTA's best interests. TTA believes that it is an opportune time to renew the fleet, since the Vessels will likely replace some older vessels upon delivery. Furthermore, the Vessels will enhance TTA's market position in terms of modern bulk carrier vessels.

9. Audit Committee/or Directors' Opinions, Which Are Different From The Board of Directors
None

Yours faithfully,
Thoresen Thai Agencies Public Company Limited

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