Mermaid Maritime Plc. - Acquisition of Seascape Surveys

Ref: COR:MS/EL08005e/ms

7 February 2008

Subject: Mermaid Maritime Public Company Limited - Acquisition of Seascape Surveys Pte. Ltd.

To: The President of the Stock Exchange of Thailand

Thoresen Thai Agencies Public Company Limited ("TTA") would like to confirm that Mermaid Offshore Services Ltd. ("MOS"), a 99.99% owned subsidiary of Mermaid Maritime Public Company Limited ("Mermaid"), has entered into a Share Sale Agreement with Seascape Pacific Limited ("Seascape Pacific"), the sole existing shareholder of Seascape Surveys Pte. Ltd. ("Seascape Surveys") in Singapore, to acquire an 80% (Eighty Percent) shareholding in Seascape Surveys' total issued and paid-up share capital (the "Share Acquisition"). The details of the Share Acquisition are as follows:

1. Date of Transaction
On Thursday, 7 February 2008, MOS signed a Share Sale Agreement with Seascape Pacific.

2. Name of the New Subsidiary of MOS after the Share Acquisition
Seascape Surveys Pte. Ltd.

3. Country of Incorporation
Singapore

4. Type of Business
Hydrographic Survey and Positioning Services to the Offshore Oil and Gas Industry

5. Relationship between MOS and Seascape Surveys
Seascape Surveys is currently MOS's largest sub-contractor, complimenting MOS's range of services to the offshore oil and gas industry. However, none of the directors or controlling shareholders of TTA and Mermaid has any interest, direct or indirect, in the Share Acquisition.

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6. List of Shareholders of Seascape Surveys Before and After Acquisition by MOS

7. Information about Seascape Surveys
Seascape Surveys was incorporated on 24 November 2004 as a limited liability company in Singapore. Its registered office is at 141 Cecil Street, #03-02 Tung Ann Association Building, Singapore 069541. Its current issued and paid up capital is 100 (One Hundred) ordinary shares of SGD 1.00 each, all owned by Seascape Pacific.

Seascape Surveys has two subsidiaries: P.T. Seascape Surveys Indonesia, a company incorporated in the Republic of Indonesia with an issued and paid up capital of 100,000 (One Hundred Thousand) ordinary shares of Rp. 9.160 each of which Seascape Surveys owns 97,000 (Ninety Seven Thousand) ordinary shares of Rp. 9.160 each equivalent to 97% (Ninety Seven Percent) of the total issued and paid up capital of P.T. Seascape Surveys Indonesia; and Seascape Inspection Services Pte. Ltd., a company incorporated in Singapore with an issued and paid up capital of 100 (one hundred) ordinary shares of SGD 1.00 each of which Seascape Surveys owns 100% (one hundred percent).

Seascape Surveys and its subsidiaries provide hydrographic survey and positioning services, primarily to the offshore oil and gas industry in the South East Asian region. This range of services includes survey and positioning services in support of exploration, inspection, construction, and production activities.

Subsequent to the Share Acquisition, MOS will become the registered owner of 80% (Eighty Percent) of Seascape Surveys' total issued and paid up share capital with Seascape Pacific retaining the other 20% (Twenty Percent). The existing Seascape Surveys management team shall be entering into management lock-up agreements with Seascape Surveys (see Conditions Precedent).

As part of MOS's commitment to enhance its Thai-based services, MOS and Seascape Pacific also plan to incorporate Seascape Surveys (Thailand) Limited ("Seascape Thailand"). The company will have an issued and paid up capital of THB 26,500,000 (Thai Baht Twenty Six Million Five Hundred Thousand) comprising 2,650,000 (Two Million Six Hundred and Fifty Thousand) ordinary shares of THB 10.00 each. MOS will own 80% (Eighty Percent) and Seascape Pacific will own 20% (Twenty Percent) of the issued and paid up capital of Seascape Thailand. Seascape Thailand will purchase

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necessary survey and positioning equipment currently used by Seascape Surveys (the "Asset Purchase") from Seascape Surveys Pty. Ltd. based in Australia ("Seascape Australia"), a company sharing common directors with Seascape Pacific.

8. Total Value of Consideration
The consideration payable by MOS to Seascape Pacific for the Share Acquisition is as follows:

1st Payment: USD 400,000 (United States Dollars Four Hundred Thousand Only) upon execution of the Share Sale Agreement.

2nd Payment: USD 4,960,000 (United States Dollars Four Million Nine Hundred and Sixty Thousand Only) upon completion of the Share Sale Agreement (subject to Conditions Precedent) on or before 21 February 2008. The shares subject to the Share Acquisition shall be transferred to MOS upon completion.

3rd Payment: An amount based upon a formula of 20% of EBITDA x 5 of the Seascape Surveys Group for the calendar year 2009 (01 January 2009 - 31 December 2009) payable within 10 (Ten) business days after release of the reviewed quarterly results of the Seascape Group for financial quarter ending 31 December 2009. This performance based formula is designed to encourage the growth of the Seascape Group by its retained management team.

4th Payment: An amount based upon a formula of 20% of EBITDA x 5 of the Seascape Surveys Group for the calendar year 2011 (01 January 2011 - 31 December 2011) payable within 10 (Ten) business days after release of the reviewed quarterly results of the Seascape Group for financial quarter ending 31 December 2011. This performance based formula is designed to encourage the growth of the Seascape Group by its retained management team.

Note: In the above payment milestones, "EBITDA" means earnings before interest income, income tax, depreciation and amortization and "Seascape Group" means Seascape Surveys and its subsidiaries including Seascape Thailand.

The consideration to be paid by Seascape Thailand to Seascape Australia for the Asset Purchase is USD 800,000 (United States Dollars Eight Hundred Thousand Only) payable upon delivery of the equipment to Seascape Thailand.

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9. Conditions Precedent
The Share Acquisition is subject to the following conditions precedent: (a) approval by relevant government authorities; (b) release of encumbrances over the sale shares (if any); (c) no material adverse change in the business of Seascape Surveys and its subsidiaries between date of signing and date of completion; and (d) execution of management lock-in agreements between existing key management personnel and Seascape Surveys (duration of 3-4 years).

10.Source of Funds
The 1st and 2nd payment for the Share Acquisition and the payment for the Asset Purchase will be funded through an increase in the issued share Capital of MOS, which was fully subscribed by Mermaid out of the proceeds received from the recent initial public offering ("IPO") of the shares of Mermaid. The 3rd and 4th payment will be funded through retained consolidated earnings of MOS and is based on a formula designed to encourage growth.

11.Basis Used to Determine the Value of Consideration
The consideration for the Share Acquisition and the Asset Purchase was arrived based on negotiations on a willing-buyer willing-seller basis with regard to current market conditions and is within fair value as assessed by Mermaid based on the current market value of the assets and future growth and earnings potential of Seascape Surveys.

12.Rationale for the Acquisition
Seascape Surveys is currently MOS's largest sub-contractor, complimenting MOS's range of services to the offshore oil and gas industry. This strategic acquisition by MOS will allow integration of Seascape Surveys assets and skilled personnel, enabling MOS to provide a comprehensive range of high quality sub-sea engineering services.

13.Size of the Transactions
The consideration of USD 5,360,000 (being the 1st and 2nd payment for the Share Acquisition) is equivalent to approximately Baht 177,094,400 (using a USD/THB exchange rate of 33.04). The size of transaction equals 1.44% of the net profit of TTA and its subsidiaries as of 30 September 2007 (the net profit of TTA and its subsidiaries as of 30 September 2007 amounted to Baht 4,968,515,223).

TTA will make separate announcements in accordance with the Rules, Procedures, and Disclosure of Information of the Stock Exchange of Thailand ("SET") when the 3rd and 4th payments for the Share Acquisition are known and made.

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The Share Acquisition is not subject to the Rules, Procedures, and Disclosure of Information of SET regarding the Connected Transactions or the Acquisition and Disposition of Assets of Listed Companies.

The consideration of USD 800,000 for the Asset Purchase from Seascape Australia is equivalent to approximately Baht 26,432,000 (using a USD/THB exchange rate of 33.04). The size of transaction equals 0.18% of the net tangible assets of TTA and its subsidiaries as of 30 September 2007 (the net tangible assets of TTA and its subsidiaries as of 30 September 2007 amounted to Baht 14,558,191,881), which is less than 3% of the net tangible assets of TTA and its subsidiaries.

The transaction of Asset Purchase from Seascape Australia is considered as a connected transaction in accordance with the Notification of SET regarding Disclosure of Information of Listed Companies concerning the Connected Transactions, because Seascape Thailand will purchase assets from Seascape Australia and Seascape Australia sharing common directors with Seascape Pacific. One of the directors in Seascape Pacific will become a director in Seascape Thailand. However, since it is considered a supporting normal business transaction with general trading conditions and with returns that can be computed from underlying assets, is the only requirement is a report to the SET when the transaction does not exceed 3% of the net tangible assets of TTA.

 

Yours faithfully,
Thoresen Thai Agencies Public Company Limited

Note: Disclosure of Information by Mermaid on the Singapore Exchange ("SGX-ST") can be viewed at:

http://info.sgx.com/webcorannc.nsf/b3b0c35c9025f91e4825735f00232564/b8c412287b0 4d0c7482573e80032c226?OpenDocument

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