Prosafe SE

Regulatory Filings • Aug 16, 2010

STATEMENT FROM THE BOARD OF DIRECTORS

PROSAFE PRODUCTION PUBLIC LIMITED

STATEMENT FROM THE BOARD OF DIRECTORS

- The Board does not recommend the offer from BW Offshore Limited -

This statement is made by the Board of Directors (the "Board") of Prosafe

Production Public Limited ("Prosafe Production" or the "Company") pursuant to

sections 6-16 and 6-19 of the Norwegian Securities Trading Act in connection

with the voluntary offer by BW Offshore Limited ("BW Offshore", "BWO" or the

"Offeror") to acquire all outstanding shares in Prosafe Production not already

owned by BW Offshore (the "Offer"). The complete details of the Offer are

described in the Offeror's offer document approved by Oslo Stock Exchange and

dated 27 July 2010.

The Offer is open for acceptance in the period from and including 29 July 2010

to 25 August 2010 at 17:30 (CET) (the "Offer Period"). BWO have reserved the

right to extend the Offer Period one or more times, however not beyond 6 October

2010 at 17:30 (CET).

The consideration offered by BW Offshore to the Company's shareholders under the

Offer is 1.2 shares in BWO and NOK 2.00 in cash per each share in Prosafe

Production. Based on BWO's closing price of NOK 8.00 per share on Friday 13

August 2010, the Offer values each Prosafe Production share at NOK 11.60 and the

total share capital of Prosafe Production to approximately NOK 2,960 billion.

Based on the closing price of the BWO share on Friday 18 June 2010, the last

trading day prior to BWO's public announcement of its intention to make the

Offer, of NOK 9.13 per share, the Offer values each Prosafe Production share at

NOK 12.96 and the total share capital of Prosafe Production to approximately NOK

3,306 billion.

The Board and its Advisors have noted the alternative consideration offered (in

the form of 1.2 BWO shares and NOK 5.25 per share) in the event that Prosafe

Production should complete the sale of its turrent and swivel business within

two days prior to expiry of the Offer Period (and on certain other conditions).

As it is clear that such sale will not be completed within the set deadline, cf.

also the Company's press release of 30 June 2010, this alternative consideration

is without relevance.

Recommendation

After careful evaluation and consideration of the terms and conditions of the

Offer, the Board has unanimously decided to advise the shareholders of Prosafe

Production not to accept the Offer. The Board has based its recommendation on an

assessment of factors that the Board has deemed relevant in relation to the

Offer, including, but not limited to, assumptions regarding the Company's

business and financials.

The Board has also received two separate fairness opinions from its financial

advisors First Securities AS and Pareto Securities AS (together the "Advisors"),

both dated 11 August 2010. The opinions both conclude that the Offer is not fair

to the shareholders of Prosafe Production from a financial point of view.

In their evaluations, the Advisors haven taken into account that the Offer is

part consideration in cash and part consideration in shares hence presenting a

potential upside to the investor in a combined company. The opinions are further

based upon and subject to the assumptions, considerations, qualifications,

factors and limitations set forth therein.

Other considerations

The Offer represents no premium to the current shareholders in Prosafe

Production and is therefore not in line with what the Board and its Advisors

perceive to be market practice. As Prosafe Production and BW Offshore operate in

the same market and should expect synergies from joint operations, an expected

premium would be even more relevant.

As set out in the press release of 22 June 2010, The Board continues, together

and with assistance from the Advisors, to evaluate the Company's strategic and

financial options in order to maximize value for all shareholders of the

Company, including actively pursuing alternative bidders to present an offer for

the shares of Prosafe Production.

As of 9 August 2010, BWO owns directly or indirectly 23.88% of the total number

of shares in Prosafe Production, while BW Euroholdings Limited, a wholly owned

subsidiary of BW Group (the largest shareholder in BWO), owns 6.01% of the total

number of shares in Prosafe Production.

The Board believes that a potential acquisition of Prosafe Production by BW

Offshore will likely result in an integration of parts of the two companies'

organizations and hence it may be consequences for Prosafe Production's

employees with regards to employee functions and the Company's places of

business.

Directors' and Management's assessment of the Offer as shareholders

The Board members who own shares in the Company (directly or indirectly), Ronny

Johan Langeland and Arne Austreid, as well as the CEO Bjørn Henriksen, COO Roy

Hallås and CFO Sven Børre Larsen, have all decided not to accept the Offer.

* * * * *

The Board`s recommendation is effective as of this date and is subject to

modification or change in the event of a material change in market conditions or

events directly affecting Prosafe Production, in which case an updated

recommendation will be provided.

Limassol, 15 August 2010

The Board of Directors in Prosafe Production Public Limited

This information is subject of the disclosure requirements acc. to §5-12 vphl

(Norwegian Securities Trading Act)

[HUG#1438036]