Happy Holidays! Nice to hear from you

I think that must be the reason the yields on his companies remain so high - not just the volatility of the tanker market, but - is Frederiksen going to move stuff - debt,equity, tankers etc - from one entity to another?

RWS


Looking at Fredriksen's history of the last decade or so, it seems the asset or debt movements
seem to be more about unlocking value. This has been the case when FRO grew too big after the
original Golden Ocean (tanker and dry bulk) acquisition. He created two spin-offs, Ship Finance
Intl (SFL)- tankers and OBO, and Golden Ocean - Dry bulk, and had FRO restart as, mostly manager,
of the tanker fleet. The ITCL subsidiary is more an anchor now, but it once was a decent stable
entity that allowed FRO to meet its working capital requirements. The Golar partnership (GMLP)
was about unlocking value from Golar (GLNG). I think in one recent presentation, GLNG mgmt
suggested that the dropdowns had unlocked $900M of value from GLNG. JF accomplished that without
diluting GLNG, and has added a significant newbuild fleet of LNG tankers to GLNG book.
Of course, he now needs a way to pay for those 11 LNG tankers and two FSRUs. If one can
stomach it, that's the risk side of the JF journey. IMHO, the high yield is part of the
trade-off for going on that ride. Again, not for everyone.