The offshore oil service company said last week it had retained the corporate finance department of Merrill Lynch & Co. to help it examine its future direction.

One of the alternatives Merrill Lynch will aid the company in examining is the sale of the offshore drilling rig company, Arethusa president and CEO Mr. Jan Rask said Friday.

"The list of alternatives to be evaluated by Merrill Lynch under the terms of its assignment includes a sale of the company,'' he said.

"It is important to note, however, that no decision has been made by our board of directors or by the major shareholders to sell the company.

"We expect to approve a sale only if the price and other terms reflect what the board of directors believes represents the company's full value,'' he said.

Financial advisor Merrill Lynch will "assist in exploring strategic alternatives to maximise shareholder value,'' Arethusa said.

The arrangement was approved by the Arethusa's board of directors.

"We have taken this step with the encouragement and support of our two largest shareholders,'' said Mr. Rask.

Arethusa's two largest shareholders are Stockholm-listed Forvaltnings AB Ratos, a Swedish investment company, and Brussels-listed Alphee AB, a Luxembourg subsidiary of CMB AB of Antwerp.

Alphee is Belgium's largest shipping company.

Arethusa reported a third quarter profit of $26.4 million but the result included $27.9 million from the sale of offshore rig Treasure Stawinner.

Arethusa, which maintains a physical presence in Bermuda with offices at Nautilus House, Warwick, owns and/or operates a fleet of 13 offshore drilling rigs, including eight semisubmersibles and five jack-ups. The company is the second largest semi-submersible operator in the Gulf of Mexico while other rigs are deployed offshore Brazil, Egypt, Holland, India and Indonesia.