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Subject:  Re: JF and a White Dwarf? Date:  3/7/2013  9:28 AM
Author:  Hohum777 Number:  13864 of 25354

I was looking at FRO several days ago:

Here is their current vessel list:

Ah! But what the fleet list doesn't show is who owns the vessels. High level picture
- 22 vessels (17 VLCCs + 5 Suezmaxes) owned by SFL
- 9 vessels (6 VLCCs + 3 Suezmaxes) owned by subsidiary ITCL
- 10 vessels (6 VLCCs + 4 Suezmaxes) owned by Frontline 2012
- 4 vessels (2 VLCCs + 2 Suezmaxes) owned by German KGs
- Mayfair owned by VLCCF, DHT Eagle owned by DHT

I also look at those spinoffs and what seems to be the percentage of the company they still own, although I don't see Frontline 2012

The spinoffs are the past- the great times when tanker rates were high, and FRO decided to unlock
value by tossing off dividends and/or shares in those other entities (SFL, Golden Ocean)

I look at their bonds due and don't see a problems until 2015.

The bonds are not an immediate problem. The bigger issues are payments to SFL and financing
of the two newbuilds.

Finally (and I can't find it), I did look at the year end results and they are bad, but frankly don't seem THAT bad.

Q4 was better than Q3, but that is typical of cyclical nature of the sector. But here's what I
was basing my comments on- trending of tanker rates (bottom of Slide 7)

Of the $137M in cash, $52M in "cash sweep" is owed to SFL in the next month or so. Plus,
FRO have to piece together financing for the two newbuilds. Now, selling one or both new
vessels (to either Frontline 2012 or SFL) is a possible, and likely, option, but it is a
short-term gap filler.

I'm probably missing a lot, but don't think I'm looking at a different company. But I don't
see the "white dwarf", but looking at the stock price, I'm clearly in the minority.

It was a "cigar-butt" play when JF agreed to the Dec 2011 restructuring of the company.
Can it be a "cigar-butt" play again? Don't know. That all depends on the moves JF and the
FRO team come up with to get through 2013.
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