UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of June, 2003
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Frontline Ltd.
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(Translation of registrant's name into English)
Par-la-Ville Place, 14 Par-la-Ville Road,
Hamilton, HM 08, Bermuda
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(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F
Form 20-F X Form 40-F
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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
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If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-
Item 1. INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached as Exhibit 1 is a copy of the press release of Frontline Ltd. dated
June 9, 2003.
Exhibit 1
PRESS RELEASE
Frontline Ltd, Hamilton, Bermuda announces the following events:
o The sale of two Suezmax tankers to OMI Corporation.
o The sale and charter back of two Suezmax tankers to German K/Gs.
o An agreement to exchange shares in six joint venture companies.
o Declaration of an extraordinary dividend of $1.00 per share, to be paid to
shareholders in early July 2003.
o The exercise of the call option on, and cancellation of, Frontline shares
held by the Bank of Nova Scotia.
1. Sale of two vessels to OMI Corporation.
Frontline Ltd., Hamilton, Bermuda announced today that it has agreed to sell two
2000 built Suezmax tankers, the Front Sun and the Front Sky to OMI Corporation
(OMI), for $49.25 million per vessel, consisting of $43.25 million cash and one
million shares of OMI common stock valued at $6.00 per share, with a share price
guarantee from OMI at $5.70 over a six month period. Frontline will pay to OMI
any shortfall of time charter equivalent earnings per vessel below an average of
$20,000 per day for one year from delivery. Deliveries are expected early in the
third quarter. Both vessels will continue in Alliance Chartering, the
cooperation between OMI and Frontline. Frontline expects to book a profit of
approximately $4 million on the sale, and generate $39 million in cash after
repaying the loans outstanding on the vessels, in addition to receiving
2,000,000 OMI shares.
2. Sale and charter back of two vessels to German K/Gs.
Frontline signed an agreement, which includes the sale of two of the
Company's 2001 built Suezmax tankers, the Front Melody and Front Symphony, to
two German K/Gs promoted by Dr. Peters GmbH. The vessels are expected to be
delivered to the new owners this month. The vessels will be chartered back on a
12.5 year time charter arrangement, including options for the Company to buy
back the vessels at the end of the charter period.
The Company expects to book a profit of approximately $8 million on the sale, to
be taken as income over the lifetime of the charter, and generate cash to the
Company in excess of $39 million.
3. Agreement to swap shares in six joint ventures.
The Company has reached an agreement with partners Euronav Luxembourg SA
(Euronav) and Overseas Shipholding Group, Inc. (OSG) to swap interests in six
joint companies, which each own a VLCC. These agreements will result in the
Company selling its interest in the vessel Pacific Lagoon to Euronav; acquiring,
jointly with OSG, Euronav's interest in the Ariake and Sakura I increasing its
share in such vessels to 50.1% each; and exchanging its interest in the Ichiban
(33.33%) with Euronav for a portion of Euronav's interest in the Tanabe and
Hakata increasing its interest in these vessels to 50.1% each. OSG will continue
as partner with the remaining interest in the four last mentioned vessels.
Commercial management for Ariake and Sakura I will be transferred from the
Tankers International Pool to Frontline's commercial operations in Oslo. The
same transfer of commercial management will take place for the vessel Edinburgh,
this vessel will keep its current ownership structure intact.
4. Extraordinary dividend of $1.00 per share.
As a consequence of the cash and shares for sale generated in the above
mentioned transactions, estimated to be USD 90 million, the Board has decided to
declare a dividend of $1.00 per share. The record date for the dividend is June
23, 2003, ex dividend date is June 19, 2003 and the dividend will be paid on or
about July 7, 2003. The pay out is in line with the strategy announced in the
first quarter report and will not influence the dividend to be paid based on the
second quarter results.
5. The Company's call option on the Frontline shares held by Bank of Nova Scotia
has been exercised.
The Board has decided to exercise the Company's call option on the Frontline
shares held by Bank of Nova Scotia. The transaction involves 3,070,000 shares,
which will be acquired at a cost of $8.97 per share. The profit on the
transaction, to be booked during the current quarter, will be approximately
$14.5 million. The shares will immediately be cancelled, bringing the number of
shares outstanding in Frontline to 73,473,066. The transaction effectively
terminates the current facility. It is the Board's intention to establish a
similar facility in the near future.
Hamilton, Bermuda
9 June, 2003
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 authorised.
Frontline Ltd.
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(Registrant)
Date June 13, 2003 By /s/ Kate Blankenship
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Kate Blankenship
Company Secretary and Chief Accounting Officer
03231.0001 #410582