Otto Marine sold Work Maintenance Vessel for US$38.0 million

• Recognises net gain of US$16.8 million that will be reflected in upcoming 3QFY2012 results

• The 75 meter Work Maintenance Vessel, Oranda 1, was simultaneously bareboat chartered back by the Group’s subsidiary to execute time-charter contract in the Gulf of Mexico

• Sales transaction sets to improve the Group’s cash flow and balance sheet

Singapore, 19 September 2012

Otto Marine Limited, (“Otto Marine” or the “Group”), a leading offshore marine company which specializes in building complex offshore support vessels, ship chartering and offers specialized offshore services, is pleased to announce that the Group has sold Oranda 1, a 75-meter Work Maintenance Vessel, to an unrelated party for US$38.0 million.

After accounting for US$21.2 million worth of net carrying value of Oranda 1, the Group will book in estimated realized gain of US$16.8 million in its upcoming financial period ending 30 September 2012 (“3QFY2012”).

Oranda 1 is an ABS-classed 4,200bhp Work Maintenance Vessel that has completed 4 projects in South East Asia since May 2010. Contemporaneous with the sales transaction, the Group’s subsidiary, Karp Marine Limited, has bareboat chartered back Oranda 1 for a period of 5 years. Oranda 1 is currently executing general topside platform maintenance works in the Gulf of Mexico under a 450-day time charter contract worth US$14.9 million. This contract was the Group’s maiden voyage into the Mexican waters and was announced back in 19 March 2012.

“Proceed from this sale transaction will be utilized towards repayment of bank loans, thereby improving the Group’s liquidity and working capital. This is very much in line with the Group’s strategy to lighten its balance sheet to optimize operations going forward.”

Aw Chin Leng, Executive Director and Deputy President

The transaction took into consideration the proper market value of the vessel. This transaction is expected to contribute positively to the Group’s 3QFY2012 financial performance.

About Otto Marine Limited (OTML.SP)
Otto Marine Limited ("Otto Marine" or the "Company") is an offshore marine group engaged in specialized shipbuilding of offshore vessels for primarily Deep Sea applications. The shipbuilding includes ship repair and conversion. In addition, Otto Marine is chartering out its own fleet of sophisticated and environmentally friendly (clean/comfort class) Anchor Handling Tugs and Offshore Supply vessels for mainly Deep Sea applications. In continuation of its expansion strategy, Otto Marine is the majority shareholder in the seismic operator, Reflect Geophysical.

Headquartered in Singapore, the Company owns and operates one of the largest shipyards in Batam, Indonesia - one of the most sophisticated yards in Asia Pacific. The yard is building to DNV and Norwegian class standards. Its customers are primarily deep sea and offshore operators and equipment companies who provide logistics support and offshore services to companies operating globally in the oil and gas industry.

Otto Marine’s specialized approach has allowed it to build up its expertise in constructing high specification deep sea and offshore support vessels, improve its production quality and efficiency and develop a competitive cost structure. This quality and level of sophistication has enabled the Company - as one of the few in Asia - to gain recognition in the construction of complex and sophisticated deep sea and offshore vessels.

Otto Marine was successfully listed on the Main Board of Singapore Exchange Securities Trading Limited (the “SGX-ST”) on 28 November 2008. For more information, please visit the Company’s website at http://www.ottomarine.com

Otto Marine press release