UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF
THE
SECURITIES EXCHANGE ACT OF 1934
For
the month of September 2008
Commission
File Number: 001-32199
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Ship
Finance International Limited
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(Translation
of registrant’s name into English)
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Par-la-Ville
Place, 14 Par-la-Ville Road, Hamilton, HM 08, Bermuda
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(Address
of principal executive office)
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Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.
Form
20-F [X] Form 40-F
[ ]
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1): ___
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)7: ___
Indicate
by check mark whether the registrant by furnishing the information contained in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes
[_] No [X]
If
“Yes” is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
82-______________.
INFORMATION
CONTAINED IN THIS FORM 6-K REPORT
Attached
as Exhibit 1 is a copy of the press release of Ship Finance International
Limited (the “Company”), dated September 16, 2008, announcing its entry into an
agreement to acquire two newbuilding, ultra-deepwater semi-submersible drilling
rigs for approximately $1.7 billion and its intention to increase its quarterly
dividend.
This
Report on Form 6-K is hereby incorporated by reference into the Company’s
Registration Statement on Form F-3 (File no. 333-150125) which was filed with
the Securities and Exchange Commission on April 7, 2008, with an effective date
of April 15, 2008.
Exhibit
1
SFL
– $1.7 billion acquisition and increased quarterly dividend
Press
release from Ship Finance International Limited, September 16, 2008
Ship
Finance International Limited (NYSE: SFL) (“Ship Finance” or the “Company”),
today announced that it has entered into an agreement to acquire two newbuilding
ultra-deepwater semi-submersible drilling rigs from subsidiaries of Seadrill
Limited (“Seadrill”) in combination with 15-year bareboat charters.
With
a total acquisition cost of approximately $1.7 billion, Ship Finance is again
breaking records for sale/leaseback transactions in the maritime industry. The
Company has received commitments for a $1.4 billion loan facility from a
syndicate of leading international banks.
The
approximately $300 million net investment by Ship Finance is planned sourced
from a combination of the Company’s available liquidity and new financing
arrangements related to existing assets. These assets include vessels with no or
very low leverage and a substantial profit share payment due from Frontline in
early 2009 ($66.8 million accumulated YTD).
Based
on this highly accretive transaction, the Company intends to increase the
quarterly dividend from $0.58 to $0.60 per share in respect of the third
quarter.
West Hercules is expected to
be delivered to Seadrill in September 2008 from Daewoo Shipyard in South Korea,
and Ship Finance expects to acquire the rig from Seadrill in early October 2008,
in combination with a 15-year charter back. Seadrill has sub-chartered the rig
to Husky Oil China Ltd. (“Husky”) the first three years at a charter rate of
approximately $524,000 per day.
West Taurus is expected to be
delivered to Seadrill in December 2008 from Jurong Shipyard in Singapore. We
will acquire the rig immediately thereafter, in combination with a 15-year
charter back. Following an estimated three month mobilization to Brazil,
Seadrill has sub-chartered the rig to Petroleo Brasileiro S.A (“Petrobras”) for
six years at a charter rate of approximately $630,000 per day.
The
aggregate net charter payments on bareboat basis from Seadrill over the first 78
months will be approximately $1.4 billion for the two rigs, and for the
remaining lease period, the aggregate charter payments on bareboat basis will be
approximately $900 million. We have enclosed a more detailed breakdown of the
charter rates at the end of the press release.
Seadrill
has been granted several purchase options, and there will also be purchase
obligations at the end of the charters. For the West Hercules, the first
purchase option will be after 36 months at $579.5 million and the purchase
obligation after 15 years will be at $135 million. For the West Taurus, the
first purchase option will be after 75 months at $418 million and the purchase
obligation after 15 years will be at $149 million.
Due
to the purchase obligations in the charter agreements, we expect that these 100%
owned rigs will be accounted for as ‘investment in associates’ based on US GAAP
accounting principles.
The
$1.4 billion loan facility will be paid down to approximately $730 million over
the 5-year term. The average annual repayment of debt will be approximately $134
million per year. Similar to most of our recent transactions, we have only
partly guaranteed the new loan facility, and of the $1.4 billion loan our
guarantee exposure is limited to $100 million per rig. We have also effectively
transferred the interest rate exposure to Seadrill through interest adjustment
of the charter rate.
With
a cash investment of approximately $300 million, the average annual net cash
contribution the first five years, after estimated interest expense and debt
repayment will be approximately $46.5 million per year.
Lars
Solbakken, Chief Executive Officer in Ship Finance Management AS, said in a
comment: "This record-breaking $1.7 billion transaction adds to our substantial
growth over the last two years. Including the two new rigs, we will have
invested approximately $3.4 billion in the offshore segment alone, and this
demonstrates our commitment to diversify our portfolio. We see significant
further growth opportunities across our target segments, and as we grow our
business, we intend to continue increasing our quarterly dividends on the back
of new accretive transactions.”
September
16, 2008
The
Board of Directors
Ship
Finance International Limited
Hamilton,
Bermuda
Contact
Persons:
Lars
Solbakken: Chief Executive Officer, Ship Finance Management AS
+47
2311 4006 / +47 9119 8844
Ole
B. Hjertaker: Chief Financial Officer, Ship Finance Management AS
+47
2311 4011 / +47 9014 1243
Charter
rate details
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West
Hercules
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Net
charter rate per day *
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West
Taurus
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Net
charter rate per day *
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Months 1-36
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$383,100
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Months 1-3
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$122,600
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Months
37-72
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$236,500
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Months 4-75
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$320,700
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Months
73-96
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$170,100
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Months
76-99
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$155,500
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Months
97-120
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$162,200
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Months 100-123
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$149,700
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Months 121-144
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$136,500
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Months 124-147
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$136,300
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Months 145-180
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$130,800
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Months 148-180
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$130,600
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*
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Estimated
average net charter rates per day on bareboat basis, assuming a LIBOR
interest rate basis of 2.90% p.a. The charter rates are payable from the
day the respective drilling rig is acquired by Ship Finance, and there
will be adjustments in the charter rates payable by Seadrill each month
based on the actual interest rate level in that
period.
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Purchase
option details**
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West
Hercules
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Purchase
option price
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West
Taurus
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Purchase
option price
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Month 36
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$579.5
million
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Month 75
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$418.0
million
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Month 72
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$431.0
million
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Month 99
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$361.0
million
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Month 96
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$366.0
million
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Month 123
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$302.0
million
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Month
120
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$297.0
million
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Month 147
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$241.0
million
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Month
144
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$236.0
million
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**
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Purchase
options timing calculated from delivery to Ship Finance and exercisable at
the end of the month indicated. In addition there are also purchase
obligations at the end of the 15-year charters at $135 million for West
Hercules and $149 million for West
Taurus.
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About
Ship Finance
Ship
Finance is a major ship owning company listed on the New York Stock Exchange
(NYSE: SFL). Including newbuildings and announced acquisitions, the Company has
a fleet of 73 vessels and rigs, including 33 crude oil tankers (VLCC and
Suezmax), 2 chemical tankers, 8 oil/bulk/ore vessels, 13 container vessels, 3
dry bulk carriers, 6 offshore supply vessels and 3 seismic vessels, 2 jack-up
drilling rigs and 3 ultra-deepwater drilling units. The fleet is one of the
largest in the world and most of the vessels are employed on long term
charters.
More
information can be found on the Company’s website:
www.shipfinance.org
Cautionary
Statement Regarding Forward Looking Statements
This
press release may contain forward looking statements. These statements are based
upon various assumptions, many of which are based, in turn, upon further
assumptions, including Ship Finance management's examination of historical
operating trends. Although Ship Finance believes that these assumptions were
reasonable when made, because assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible to predict and
are beyond its control, Ship Finance cannot give assurance that it will achieve
or accomplish these expectations, beliefs or intentions.
Important
factors that, in the Company's view, could cause actual results to differ
materially from those discussed in this presentation include the strength of
world economies and currencies, general market conditions including fluctuations
in charter hire rates and vessel values, changes in demand in the tanker market
as a result of changes in OPEC's petroleum production levels and world wide oil
consumption and storage, changes in the Company's operating expenses, changes in
governmental rules and regulations or actions taken by regulatory authorities,
potential liability from pending or future litigation, general domestic and
international political conditions, potential disruption of shipping routes due
to accidents or political events, and other important factors described from
time to time in the reports filed by the Company with the United States
Securities and Exchange Commission.
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly
authorized.
| SHIP FINANCE INTERNATIONAL LIMITED | |||
| (registrant) |
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Dated: September
16, 2008
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By:
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/s/ Lars
Solbakken
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Name:
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Lars
Solbakken
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Title:
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Chief
Executive Officer
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Ship
Finance Management AS
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SK 23153 0001
919412