OSLO, Norway, Oct. 16, 2000 (PRIMEZONE) -- Frontline has completed the acquisition of the Golden Ocean Group. In connection with the final settlement with the unsecured creditors, Frontline has issued a total of 1,245,998 new Frontline shares at aN issue price of USD 15.65 per share (NOK 143.45). The issue price was set as the average share price during the ten days prior to effective date. The total number of outstanding shares in Frontline will after this be 79,785,565.
Based on the acceptance forms from the unsecured creditors in the bankruptcy, the total number of shares issued would have been approximately 2.1 million. The Board has, however, used its right to limit the number of shares to the contractual minimum, and pay the excess amount in cash. Totally, USD 18.7 million will be paid to external unsecured creditors. The decision to limit the stock alternative to a minimum is taken after a careful consideration of the issue price, Frontline's limited, existing forward capital expenditures and the Company's strong cashflow. The Board has, based on these three factors, sought to limit the dilution in future earnings and value development per share for the existing shareholders.
Chairman John Fredriksen says in a comment to the transaction, "We are very pleased with the fact that we today can include Golden Ocean as a subsidiary of the Frontline Group. When Golden Ocean filed their bankruptcy in January and Frontline started to acquire the unsecured debt, the VLCC T/C spot rates were between USD 10 - 15,000 per day. Since then we have been through a strong recovery in the market. We feel that the addition of 13 modern VLCCs to the Frontline fleet positions our Group well for the future, and creates a well timed upside for Frontline's equity holders."