DOF Sets Offer Price to Acquire DOF Subsea's Shares

On 19 September 2008, DOF ASA and First Reserve Corporation (FRC), the leading energy-focused private equity firm, entered into an agreement whereby DOF, subject to the conditions described below being satisfied, shall put forward an offer to acquire all of the outstanding shares of DOF Subsea ASA at NOK 39.00 per share in cash.

The Offer will represent a 41.8% premium to the last closing share price and a 27.9% premium to the closing share price on 9 July 2008 of NOK 30.50 which was the last trading day prior to DOF announcing its intention to acquire DOFSUB. As part of the agreement, DOF and FRC have also agreed to enter into several subsequent transactions as described herein if the Offer is successful and certain conditions are satisfied.

The launch of the Offer is subject to satisfaction of certain conditions, including but not limited to (i) agreement between DOF and FRC on certain remaining documents and agreements, (ii) receipt of required consents and waivers from certain lenders to DOFSUB and (iii) signing of a term sheet in relation to the financing of DOF's cash payments under the Offer. The Offer will be conditional upon, among other things, a minimum acceptance level giving DOF more than 90% of DOFSUB's shares on a fully diluted basis, that all required governmental
approvals are obtained, that the financing under the term sheets referred to above is available and other customary conditions. DOF is currently the majority owner of DOFSUB holding 57.05% of the share capital.

If the Offer is successful, DOF will proceed with a compulsory acquisition according to the Norwegian Public Limited Companies Act of the remaining outstanding shares in DOFSUB and delist DOFSUB. Following
the acquisition of the remaining shares in DOFSUB (including the compulsory acquisition), DOF will transfer 100% of the shares in DOFSUB to a newly incorporated private holding company (HoldCo), which will then be owned 51% by DOF and 49% by FRC. As a result of the Offer, DOF will in effect reduce its ownership in DOFSUB from 57.05% to 51%.

If the Offer is successful DOF and FRC have agreed that HoldCo will acquire the 50.5% of the shares in DOF Installer ASA (DOFI) that are currently controlled by DOF, at a price of NOK 135 per share in exchange for new shares in HoldCo. Following the acquisition of DOF's shares in DOFI HoldCo intend to put forward a cash offer to acquire the remaining shares outstanding in DOFI at NOK 135 per share. Such offer will be conditional upon, amongst other things, a minimum acceptance level giving HoldCo more than 90% of DOFI's shares on a fully diluted basis, that all required governmental approvals are obtained and other customary conditions. FRC will contribute cash as equity in Holdco in an aggregate amount required to maintain its 49% ownership in HoldCo
following such transaction. Following the offer for the remaining shares in DOFI, it has been agreed that DOF will purchase hull no. 706 from DOFI for a cash consideration of approximately NOK 165 million based on broker values.

Furthermore, and subject to the successful completion of the Offer and certain other conditions agreed between DOF and FRC, HoldCo will acquire from DOF the rights under the shipbuilding contracts for the three ROV support vessels currently being built for DOF at the Tebma yard in India with expected delivery in 2009 and 2010 for approximately NOK 300 million in exchange for shares in HoldCo. FRC will contribute cash as
equity in Holdco in an aggregate amount required to maintain its 49% ownership following such transaction. As part of this transaction, HoldCo will assume the remaining capital expenditure commitment in relation to the acquired ship building contracts.

Separately, and subject to the successful completion of the Offer, FRC will subscribe for new shares in Norskan AS, a 100% owned subsidiary of DOF, in a directed equity offering which will give FRC a 25% ownership in Norskan AS post such equity offering. The directed equity offering is expected to raise new equity capital of approximately NOK 600 million in Norskan AS. Norskan AS is the holding company of the Norskan Offshore group which will own and operate a total fleet of nine offshore vessels in Brazil.

Mons Aase, CEO of DOF, made the following comment in relation to the announcement: "The transactions will provide DOF and DOF Subsea with the capital to pursue their growth strategies and enable them to consolidate and strengthen their position in Brazil. Furthermore, the capital infusion alongside of FRC's investment expertise in energy services companies will enable DOF Subsea the opportunity to take advantage of global
growth and demand trends. We believe that the offer price of NOK 39 per share, a premium of approximately 42% compared to last closing share price, represents an attractive offer to the DOF Subsea shareholders."

Added Tom Sikorski, Managing Director of First Reserve Corporation, "We are pleased to partner with DOF and the management team and employees of DOF Subsea to assist them in their growth plan. Both DOF Subsea and Norskan present unique opportunities for First Reserve to address market demands for additional vessels and services, and to participate in the continued growth of offshore activity expected in Brazil, Asia and West Africa. Together, they have an established global footprint and one of the most modern, highest quality and largest fleets in the world which, in a sector with historic undersupply, offers First Reserve unrivalled opportunity for growth."



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