Reference is made to the stock exchange release from Ocean Yield ASA ("Ocean Yield") dated 16 December 2016, where EMAS Chiyoda Subsea Group ("ECS") requested to enter into a short- term standstill agreement relating to the bareboat charter of the Lewek Connector (the "Vessel").
In order to protect Ocean Yield's legal interest, a notice of termination related to the bareboat charter has now been served.
The Company will however continue to participate in the discussions regarding a financial restructuring of ECS. Simultaneously, Ocean Yield is considering a potential short- term contract for the Vessel to a related company of Ezra Holdings Ltd. ("Ezra") at a reduced rate while a long-term solution is being discussed.
As a consequence, an impairment charge of approximately USD 35 million will be considered by the Board of Directors for the Q4 2016 results. Following delivery of six vessels during the fourth quarter and the refinancing of the bonds in American Shipping Company ASA, Ocean Yield has strong underlying earnings and cash position, so the reduced earnings from Lewek Connector is not expected to have any negative impact on the dividends in the near term.
EMAS Chiyoda Subsea Group is owned 40% by Ezra, 35% by Chiyoda and 25% by NYK. ECS's obligations under the charter party for the Lewek Connector are guaranteed by Ezra Holdings Ltd., listed on the Singapore Stock Exchange.
Company contacts: Lars Solbakken, CEO of Ocean Yield ASA Phone: +47 24 13 01 90
Eirik Eide, CFO of Ocean Yield ASA Phone: +47 24 13 01 91
Investor Relations contact: Marius Magelie, SVP Finance & IR of Ocean Yield ASA Phone: +47 24 13 01 82
This notice is issued pursuant to Section 5-12 of the Norwegian Securities Trading Act