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CLR-Tufton Oceanic Agreement

During the Board meeting of CLR Financial Services Ltd. which took place on the 18 September 2001 it was decided to proceed with the signing of a final agreement for acquisition of the company Tufton Oceanic Finance Group Ltd. which offers consulting services, fund management, financing and other financial activities in the shipping and oil sectors. The acquisition was supported by the management of Tufton Oceanic Finance Group Ltd. and by Interorient Navigation Co. Ltd., one of the largest ship management organisations based in Cyprus.

Within the next few days, it is expected that the final agreements will be signed with the owner company Tufton Oceanic Investments Ltd., shareholders of which are notable organisations such as GE Capital Corp., the Dutch bank NIB Capital Bank and others, based on which:

1. CLR Financial Services will acquire 52.5% of Tufton against the sum of US$3.15 million in cash and 1.6 million in new shares of CLR Financial Services Ltd. Towards this end, the Board decided to issue and offer 1.6 million shares from the unissued share capital of 19 million shares which it can issue based on the unanimous decision of the EGM of the 5 June 2000, for future contracts and/or acquisitions.
2. Tufton Oceanic Investments Ltd. will have the option, for a period of two years, to issue and offer 800.000 new shares of CLR Financial Services Ltd. at the price of CYP 1.00 per share. In the event of exercising of this option, the shares will be issued based on the aforementioned decision of the EGM.
3. Management staff of Tufton will participate in Tufton by 30%
4. The remaining 17.5% will be acquired by Interorient Navigation Co. Ltd.

Activities of Tufton Finance Group Ltd.

Tufton Oceanic Finance Group Ltd. is registered in Cyprus and is the holding company of a pioneering Group of companies active internationally in various financial services such as:

· Investment banking consulting services
· Fund Management
· Financing
· Relevant activities in the shipping and oil sectors.

Consulting Services

The Group offers specialised services of a high level of a wide range of investment banking services specialising in the shipping and oil sectors. Its activities include consulting services for mergers and acquisitions, restructuring of groups as well as reorganisation of the companies' capital base. The company's subsidiary Tufton Oceanic Ltd. is registered with the Securities and Futures Authority of the United Kingdom and holds all the necessary licenses for offering investment services.

The Group has successfully advised a great number of large ranging companies and is considered one of the most significant players internationally in its sector. Amongst others, it has successfully effected the reorganisation of:

· Reading & Bates, one of the largest drilling contractors based in Houston of the United States
· Golden Ocean, a large sea transport organisation
· Renaissance Cruises, one of the largest sea tourism organisations.


Tufton Oceanic has long experience in various financing options adjusted to the individual needs of each client. The Group is in a position to exploit the wide range of connections it has with international banking organisations, securing the best form of financing for each client.

Fund Management

The Group offers Fund Management services. Funds under management reach US$170 million. Based on the management agreement between Tufton Oceanic Investments Ltd. and Tufton Oceanic Finance Group Ltd., the latter will manage the portfolio of the first for a guaranteed minimum of three years.

Financial Details of Acquisition

Profits of the Tufton Oceanic Finance Group Ltd. during the year ending 30 June 2001 were US$2.089.800 with profits attributable to shareholders of US$3.589.800.

The acquisition price equals a P/E ratio of 5,1 on profits after taxation of the Group for the last fiscal year which are considered as recurring.

Goodwill derived is US$4.213.928 which will be written off over a period of 20 years.

Benefits for CLR Financial Services Ltd.

CLR Financial Services Ltd., within the expansion plans of the Group, decided to expand specialised activities through strategic alliances and strategic investments with companies of established status which have the know-how and experience in the relevant sectors. The investment in Tufton Oceanic Finance Group Ltd. falls within these plans through which CLR Financial Services Ltd. achieves its aim for expansion internationally of its activities, implementing its strategic expansion of income sources from outside Cyprus.

Through the acquisition, CLR Financial Services Ltd. expects that its future profitability will be increased due to the following reasons:

· Expansion of its range of services as well as specialised services in the oil and shipping sectors.
· Through Tufton Oceanic Ltd. based in London, CLR Financial Services Ltd. will be able to expand its operations in the United Kingdom. As a result, it expands its range of services outside Cyprus. Further, CLR Financial Services Ltd. aims to utilise the infrastructure of Tufton Oceanic Ltd. for the development of investment banking services to other sectors.
· The know-how of personnel of the Tufton Group in Cyprus and the level of services offered will be upgraded. An important element is the continuing active participation of staff of Tufton Oceanic after the signing of the agreement as they will hold 30% of the share capital of Tufton Oceanic Finance Group Ltd.
· The Tufton Oceanic Finance Group has achieved profits of US$2.089.800 for the 12 months ending 30 June 2001. It is underlined that based on approval by the Central Bank the entire aforementioned profits will be disbursed as dividends to shareholders of Tufton Oceanic Finance Group Ltd. and thus CLR Financial Services Ltd. will gain 52.5% of the dividends.
Wednesday, 19 September, 2001 - 12:46