elected Mr. Michael Naess as chairman of its board of directors.

Mr. Naess replaces Mr. Guner Rosengren, who resigned his position due to ill-health. Mr. Rosengren will stay on as a director.

Also elected to the board was Mr. Arie L. Shapiro, managing director of Marine Lendlease Ltd., a London-based investment banking firm specialising in the marine industry.

Mr. Naess, 54, a US citizen living in Warwick, has also been elected chairman of the executive committee of the board.

He is president and CEO of Shipping Development Company Ltd., a privately-held international investment company, and of Surf Side Properties Ltd., operator of Surf Side Beach Club, in Warwick.

Before coming to live in Bermuda in 1989, Mr. Naess lived for 20 years in Houston, Texas.

After receiving his MBA from Harvard University in 1969, Mr. Naess moved to Houston to become vice president/corporate development of Southdown, Inc.

In 1970, he was transferred to Southdown's parent company, Zapata Corporation, where he served initially as executive vice president and chief operating officer with responsibility for Zapata's shipping interests, its construction business, its service boat division and is offshore drilling activities.

He left Zapata in 1978 and founded Westminster Ventures, Inc., his own venture capital advisory firm.

Mr. Shapiro was managing director of Marine Lendlease (UK) Ltd., a wholly-owned subsidiary of Marine Lendlease Ltd., from 1978 to 1985.

From 1968 to 1980, he held a number of executive positions and directorships with subsidiaries of GATX Corporation, including the position of president and CEO of GATX Ship Leasing and Mortgage Corporation.

Arethusa was formed in Bermuda in 1990 with capital of $230 million by European investors seeking to acquire offshore drilling rigs and associated equipment then owned by Zapata Off-Shore Company.

Arethusa currently owns and/or operates a fleet of 15 mobile offshore drilling rigs, including ten semi-submersibles and five jack-ups, in the Gulf of Mexico, Brazil, the Netherlands, India and Indonesia.

Arethusa's US operating subsidiary, which is based in Houston and called Arethusa Off-Shore Company, employs some 1,000 people, most of whom are former employees of Zapata.

Last month, Arethusa successfully completed an initial public offering of new shares of its common stock valued at $40 million.

The proceeds were used by the company to help acquire two additional semi-submersibles, valued at $69 million, from Norwegian interests.

Both units are designed and equipped to drill in water depths up to about 3,000 feet.

Arethusa's shares are now publicly traded on the NASDAQ stock exchange under the symbol ARTHF.