OTTO MARINE LIMITED

(Company Registration Number 197902647M)

(Incorporated with limited liability in the Republic of Singapore on 5 September 1979)

OTTO MARINE DISPOSED THREE VESSELS FOR USD37.5 MILLION 1. INTRODUCTION

Otto Marine Limited (the "Company") wishes to announce that its subsidiaries, Dolphin 2 Pte. Ltd., Dolphin 3 Pte. Ltd. and Dolphin 4 Pte. Ltd. (collectively the "Sellers"), have signed a Memorandum of Agreement ("MOA") to dispose three of its vessels known as GO AVIOR, GO HAWK and GO HARRIER (collectively the "Vessels") to Go Marine Services (M) Sdn Bhd (the "Purchaser"), a company incorporated in Malaysia in which it owns 49%, for a sum of USD37.5 million (the "Transaction").

2. INFORMATION ON THE VESSEL

The Vessels are three (3) 6,000 bhp AHTS known as "GO AVIOR" and "GO HAWK"
and "GO HARRIER".

3. THE TERMS OF PURCHASE

3.1 Purchase Consideration: The purchase obligation price of the Vessels to be paid by the Purchaser is USD37.5 million (the "Purchase Price") in total.
3.2 Basis for determining the Purchase Consideration: The Purchase Price was arrived
at on an arm's length willing buyer, willing seller basis.
3.3 Terms of payment: The Company will receive a deposit of USD3.75 million in cash and the Purchaser would assume the existing remaining bank loans for the Vessels and balance plus the interest accrued will be paid within 12 months from the delivery of the Vessels.
3.4 The proceeds from the Purchase Price received will be for the Sellers' accounts.

4. MATERIAL CONDITIONS TO THE TRANSACTION

(a) The Vessels shall be delivered to the Purchaser and taken over safely afloat at a safe and accessible berth or anchorage at their present locations.
(b) The Transaction is conditional upon the Purchaser obtaining the relevant approvals from Bank Negara Malaysia for the purchase of the Vessels and the transference of the existing bank loans by the Sellers to the Purchaser.

5. RATIONALE FOR THE TRANSACTION

The Board is of the view that the Transaction is in the best interests of the Company
and its shareholders (the "Shareholders") as:-
(a) the Purchase Price took into account the proper market value of the Vessels;
and
(b) the gain from the Transaction would improve the liquidity of the Company and its subsidiaries.

6. FINANCIAL EFFECTS OF THE TRANSACTION

On completion of the Transaction, the Company and its subsidiaries (the "Group") would realize an estimated net gain of approximately USD1.02 million which represents the excess of the Purchase Price of the Vessels over its carrying value net of a deferred gain of USD0.98 million.
The financial effects of the Transaction are as set out below. The financial effects are shown for illustrative purposes only and do not necessarily reflect the exact future financial position and performance of the Group.
6.1 Use of proceeds: The net proceeds from the sale of the Vessels would be used to improve the working capital of the Group.
6.2 Book and market value: The carrying net book value of the Vessels in the accounts of the Group was approximately USD35.5 million in total. The market value of USD37.5 million is derived on a willing buyer, willing seller basis, taking reference from the offer price by outside parties for similar vessels.

6.3 Net T ang ible Asset (" NTA" ) per shar e :

For illustration purposes, assuming that the Transaction had taken place on 31
December 2013, being the end of the most recently completed financial year (for which financial results are available) and based on the audited consolidated financial statements of the Group at 31 December 2013, the Transaction would have had the following effect on the Group's NTA as presented in the table below: -

Before the Transaction

After the Transaction

NTA (USD 'm)

264.7

265.8

Number of shares ('000)

4,126,940

4,126,940

NTA per share (US cents)

6.41

6.44

6.4 Earning s ( Loss) per Share ( " EPS" ):

For illustration purposes, assuming that the Transaction had been completed on 1
January 2013, being the beginning of the most recently completed financial year
(for which financial results are available) of the Group for financial year ended 31
December 2013, the Transaction would have had the following effects on the
Group's EPS as presented in the following table: -

Before the Transaction

After the Transaction

Earnings (Loss) per

share

(US cents)

Basic

0.38

0.41

Fully Diluted

0.38

0.41

7. INTERESTS OF DIRECTORS AND CONTROLLING SHAREHOLDERS

None of the directors or controlling Shareholders of the Company has any interest, whether direct or indirect, in the Transaction other than through their shareholdings in the Company.

8. COMPLIANCE WITH THE SGX-ST LISTING MANUAL

8.1 Rule 1006 of the Listing Manual: The relative figures computed on the bases set out in the Rule 1006 of the Listing Manual are as follows: -

Rule 1006(a) - The net asset value of the assets to

be disposed of, compared with the Group's net

asset value. This basis is not applicable to an acquisition of assets. D

12.28%

Rule 1006(b) - The net profits attributable to the

assets disposed, compared with Group's net profits.

7.56%

Rule 1006(c) - The aggregate value of the consideration received, compared with the

Company's market capitalisation based on the total

number of issued shares excluding treasury shares.

16.26%

Rule 1006(d) - The number of equity securities issued by the Company as consideration for an

acquisition, compared with the number of equity securities previously in issue. D

Not applicable

8.2 As the relative figures under Rules 1006(a), 1006(b) and 1006(c) of the Listing Manual exceed 5%, the Transaction constitutes a discloseable transaction as defined in Chapter 10 of the Listing Manual.
By Order of the Board
Garrick James Stanley
Executive Director and Group CEO
27 June 2014

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