In connection with the listing process Nexus aims to raise approximately US $40 million in new equity. The issuance of capital will likely be done prior to the listing approval from the Oslo Stock Exchange and is planned to include certain preferential treatment of existing shareholders. Nexus has been informed by its main shareholder APL ASA that APL has resolved to maintain its ownership stake of approximately 40% in connection with the issuance of equity.
Nexus has also received a committed offer of a bank loan facility amounting to US $320 million available as construction financing for the construction of the company's first FPSO at Samsung Heavy Industries. Nexus has also mandated Swedbank/First Securities to raise additional funds in an issue of corporate interest bearing bonds.
As a result of the above financial plans, Nexus is expected to achieve a fully financed construction project for its first FPSO under construction at Samsung Heavy Industries, whilst maintaining a highly leveraged financial structure. The company share of loan financing in relation to total assets is expected to remain at approximately 75% on a fully financed basis. The Board of Nexus is pleased to be able to maintain such leveraged financial structure to the benefit of its shareholders.
The construction of the FPSO is progressing on budget and on schedule according to the initial plans. Detailed engineering is on-going and the next stage of the construction process, hull steel cutting, is scheduled for second half 2007. Nexus also has a right to order one similar FPSO from Samsung Heavy Industries.
Nexus has revised its capital requirements in connection with the process of securing full financing for the first FPSO. The company expects to incur additional financing costs of approximately US $25 million mainly in connection with the issuance of interest bearing bonds. Also, the company has ordered minor certain extra equipment and fixed certain price elements subject to currency adjustments in its construction contract. Based on the above revision, the expected capital requirement for Nexus' first FPSO is expected to be approximately US $665 million inclusive of owner supplied equipment, corporate overhead, construction supervision, construction financing costs and contingencies. Nexus do not expect further significant changes in the project cost for the vessel.
Nexus is marketing the FPSO systematically worldwide for charter contracts. The vessel is attractive in the market place through its high quality specifications, semi-generic design and attractive delivery, which is scheduled for second quarter 2009. The Board of Nexus is optimistic regarding the potential of securing a charter contract for the vessel.
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