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TTA firmly committed to supporting Mermaid's fundraising initiative Offshore services subsidiary pursues rights issue to fund drilling fleet renewal and other opportunistic investments

Back Mar 29, 2013

Bangkok, Thailand, 29 March 2013 -- Thoresen Thai Agencies Public Company Limited ("TTA") today confirmed its support for a capital increase plan proposed by its offshore oil and gas services subsidiary, Mermaid Maritime Public Company Limited ("Mermaid"). Mermaid, which is listed as "MMT" on the Singapore Stock Exchange, announced on 20 March 2013 that it plans to raise up to SGD 176.1 million (approximately USD 140.9 million) through a rights issue and private placement in order to fund opportunistic investments, including the initial payment for two new-build drilling rigs and the repayment of loan facilities.

TTA's stake in Mermaid (including an indirect stake held by Soleado Holdings Pte. Ltd., a wholly owned subsidiary ("Soleado")) stands at 57.14%. TTA's Board of Directors has approved plans to subscribe to 100% of TTA and Soleado's allocation of rights shares, implying an injection of approximately SGD 100 million, or USD 80.5 million, into Mermaid.

TTA Executive Vice Chairman and acting CEO of Mermaid, Mr. Chalermchai Mahagitsiri stated, "Recent data suggests that global exploration and production spending will reach a record high of USD 645 billion in 2013. Asia and the Middle East are expected to be the fastest growing regions, with spending rising by 10% year-on-year, nearly double that of other regions. Looking specifically at Mermaid's prospects, we have built the capabilities, relationships, and track record to capitalise in these markets. However, the right people and assets will need to be put in place in order to realise the full potential of the market upturn."

Over the last two quarters, Mermaid and its subsidiaries have established strong momentum through a number of deals in the Middle East and Asia, including a five-year inspection, repair and maintenance contract, a five-year full service offshore field maintenance deal, a six-month subsea construction services agreement, and a five-month accommodation barge contract extension, among others. The potential revenues from deals announced in the last six months stands at over USD 500 million.

In addition, Asia Offshore Drilling Ltd ("AOD"), in which Mermaid holds a 33.76% stake, has locked in nearly USD 700 million in revenues over three years for its three new-build high specification jack-up rigs, all of which will provide drilling services to Saudi Arabian Oil Company ("Saudi Aramco"), the largest oil and gas company in the world.

"As previously planned, TTA will use the majority of the proceeds of its own recent rights issue to support Mermaid's fundraising plans, particularly in light of the opportunity we have to reap the benefits of an extended industry upturn," added M.L. Chandchutha Chandratat, TTA's President & CEO. "At the same time, we will continue to explore opportunities in the new-build and second hand markets to boost our dry bulk shipping fleet, in expectation of a gradual industry improvement beginning next year."

About TTA
Thoresen Thai Agencies Public Company Limited ("TTA") is a strategic investment holding company listed on the Stock Exchange of Thailand (TTA:TB). Its investment strategy is to grow through a balanced and diversified business portfolio of transport, energy, and infrastructure assets, both domestically and internationally. TTA's evolution away from a pure dry bulk shipping operator began in 1995 with an investment in Mermaid Maritime Public Company Limited, which has since been listed on the Singapore Stock Exchange (MMT:SP). Since then, TTA has acquired interests in fertiliser and logistics (Baconco Co., Ltd.) coal-related businesses (SKI Energy Resources Inc, Merton Group (Cyprus) Limited, and Unique Mining Services Public Company Limited), petroleum tankers (Petrolift, Inc), and a port in Southern Vietnam (Baria Joint Stock Company of Service for Import Export of Agro Forestry Products and Fertilizers).