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    Bergen Group confirms agreements with Davie and Cecon

    Yard News // December 11, 2008

    Bergen Group in Norway has confirmed that it has entered into a Letter of Intent with Davie Yards in Canada, through which Bergen Group will contribute management resources and a minor amount of capital. 

    In parallel, Bergen Group and Cecon, which has a number of vessels building at Davie, have entered into a Heads of Agreement, by which the parties agree to establish a new
    company.

    Bergen Group will control 51 per cent of voting shares in
    the new company through a minor capital investment. The new company intends to invest up to US$10 million in Davie, in order to become an industrial partner with Davie and to secure co-operation between Bergen Group and Davie Yards.

    Bergen Group will also enter into a management agreement with Davie. The purpose of the management agreement is to secure that Bergen Group can provide Davie with knowledge and advice related to operation supervision, project management and change processes.

    The ambition is to assist Davie in securing delivery of the existing order backlog and also contribute to develop the yard for the future.

    "The Canadian government has clearly stated that they are backing the shipbuilding industry in Canada. We would like to assist in developing Davie for the future, enabling the yard to serve the Canadian oil and gas industry, the Canadian Naval Fleet and the offshore shipping industry", said Pål Engebretsen, CEO of Bergen Group.

    Mr Engebretsen continued: "There are significant offshore
    opportunities in Canada and in the Artic area. The co-operation agreement with Davie represents a modest risk for us with only a minor capital investment, but with an interesting upside."

    "The agreement will increase earnings per share and cashflow per share for Bergen Group from 2009 and onwards. In addition we see a long term potential in Canada beyond 2010."

     

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