outstanding shares in Mosvold Shipping. Frontline is offering NK5.50 per share which represents a 34 percent premium over Mosvold's average closing price for the last 30 days and values Mosvold at around NK420 million, which is about $46 million.

Frontline already controls 12 percent of Mosvold's share capital through shares and forward contracts. The offer document will go out to shareholders this week, with an acceptance period of two weeks.

The main pre-conditions for the offer are that: Shareholders representing a minimum of 95 percent of Mosvold's issued and outstanding shares accept the offer; Frontline is given the opportunity to review the loan agreement with respect to Mosvold's convertible loan, and finds this not to include terms which will influence Frontline's valuation of Mosvold negatively; Mosvold's board declares that Frontline will have complied with its duty to make an offer to all shareholders in Mosvold according to Article 42 in Mosvold's by-laws by making the offer; and Mosvold's board declares it will not make use of the provisions of Article 35 in Mosvold's by-laws as a basis for denying approval of any transfer of shares to frontline as a consequence of the offer.

Frontline said the public offer is strategically based on Frontline's wishes to continue the consolidation process within the highly fragmented tanker industry. A combination of Mosvold and Frontline will reduce the combined cost structure.

The inclusion of Mosvold's newbuilding program will also further strengthen Frontline's position as the premium operator of modern tanker tonnage.