Saga Pure - Capital/Financing Update 2014

SAGA TANKERS ASA: DETAILED STOCK EXCHANGE ANNOUNCEMENT REGARDING DEMERGER OF CERTAIN ASSETS OWNED BY FERNCLIFF TIH 1 AS

Reference is made to the stock exchange notice dated 23 July 2014 regarding the

signing of a demerger plan between Saga Tankers ASA ("Saga" or the "Company")

and Ferncliff TIH 1 AS ("Ferncliff"). Reference is furthermore made to the

notice of the extraordinary general meeting of the Company and the documentation

accompanying the notice (published on the Company's website www.sagatankers.no).

A detailed stock exchange notice is hereby released in compliance with the

requirements pursuant to section 3.4 of the continuing obligations for companies

listed on the Oslo Axess. An information memorandum will be released pursuant to

section 3.5 of the continuing obligations.

1 THE TRANSACTION AND THE PARTIES TO THE TRANSACTION

The transaction (the "Transaction") is a demerger of certain assets owned by

Ferncliff. The assets shall be spun out from Ferncliff and merged into the

Company (Norwegian: Fisjonsfusjon). The parties to the transaction are thus the

Company and Ferncliff.

The assets (the "Assets") to be spun out from Ferncliff and merged into the

Company consist of an ownership interest and shares in Vallhall Fotballhall KS,

Vallhall Fotballhall AS and Vallhall Fotballhall Drift AS, and shares in the

listed companies Prospector Offshore Drilling S.A (ticker PROS) and SD Standard

Drilling Plc (ticker SDSD). Saga already holds shares and an ownership interest

in the abovementioned companies.

Please find below an overview of Saga's shares and ownership interest in such

companies pre and post the Transaction, as well as an overview of the shares and

ownership interest comprised by the Assets.

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The purpose of the Transaction is the development and consolidation of the

current core activities of the Company in the companies comprised by the Assets,

as further accounted for below.

The Transaction is governed by the Norwegian Public Limited Liability Act

chapter 14 and will be implemented with continuity for accounting and tax

purposes.

The board of directors of the Company (the "Board") will propose at an

extraordinary general meeting of the Company, to be held on 25 August 2014, that

the shareholders of the Company approve the Transaction. Provided that the

shareholders approve the Transaction, the Transaction will be registered with

the Norwegian Register of Business Enterprises for the mandatory creditor

notification period of 6 weeks. Following the creditor notification period and

the clarification of any, if any, objections by the creditors, the completion of

the Transaction will be registered with the Norwegian Register of Business

Enterprises around the middle or end of October 2014.

2 CONSIDERATION UNDER THE TRANSACTION

As consideration for the Assets to be transferred to the Company under the

Transaction, the sole shareholder of Ferncliff, Mr. Øystein Stray Spetalen, will

receive 89,056,319 new shares in the Company, each with a par value of NOK 1 and

at a price of NOK 2.175 per share. Following the completion of the Transaction,

Mr. Spetalen will own 98.3 % of the total outstanding shares in the Company. The

value of the new shares received by Mr. Spetalen is NOK 193.7m.

The share capital of the Company will be increased by NOK 89,056,319, from NOK

86,777,409 to NOK 175,833,728. The increase in share capital of the Company will

be registered at the same time as the completion of the Transaction.

3 FURTHER DESCRIPTION OF THE COMPANY, THE ASSETS AND THE

TRANSACTION

The business activity of the Company is investment and management related to

shipping, rig, real estate, stock trading and other related business activities.

The Company's Board consists of the following persons:

* Mr. Øystein Stray Spetalen, Chairman of the Board of Directors;

* Mr. Martin Nes, Director of the Board;

* Mrs. Brita Eilertsen, Director of the Board.

The composition of the Board will not be changed as a consequence of the

Transaction.

The management of the Company consists of its CEO, Mr. Espen Lundaas. Mr.

Lundaas also occupies the position as CFO of the Company. Mr. Lundaas is the

sole employee of the Company. No employees of Ferncliff will be transferred in

the Transaction.

As stated above, the Company already holds shares in the companies comprised by

the Assets.

The Assets have not been subject to separate financial reporting. However, both

PROS and SDSD are companies listed on the Oslo Axess stock exchange and are thus

subject to the same disclosure requirements regarding financial statements as

the Company. For further financial information regarding PROS and SDSD, please

refer to the periodic financial statements of both companies. The financial

statements may be found at the companies' websites

(http://www.prospectoroffshoredrilling.com/ and http://www.standard-

drilling.com/, respectively).

The shares in Vallhall Fotballhall have been accounted for as associated

companies, as the Company exercises significant influence over Vallhall

Fotballhall by virtue of board representation. The Company's financial reports

regarding its shares and ownership interest in the Vallhall Fotballhall

companies may be found in the annual report for 2013 (published on the Company's

website www.sagatankers.no.)

The results and aggregated assets and liabilities of the shares and the

ownership interest in the Vallhall Fotballhall companies to be transferred as

part of the Transaction for 2012 and 2013 are set out below:

Per 31 December 2012:

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+-------------+--------------+----------+-----------+-----------+-------+------+

|Vallhall |Norway |2,199,019 |-199,674 |519,536 | -| -|

|AS | | | | | | |

+-------------+--------------+----------+-----------+-----------+-------+------+

|Vallhall |Norway |735,819 |-11,504 |453,180 | -| -|

+-------------+--------------+----------+-----------+-----------+-------+------+

|Vallhall |Norway |33,106,290|-6,070,541 |15,039,759 | -| -|

|KS | | | | | | |

+-------------+--------------+----------+-----------+-----------+-------+------+

|In total | |36,041,129|-6,281,719 |16 012 475 | -| -|

| | | | | | | |

+-------------+--------------+----------+-----------+-----------+-------+------+

Per 31 December 2013

+-----------+-------------+----------+----------+-----------+---------+---------+

+-----------+-------------+----------+----------+-----------+---------+---------+

|Vallhall |Norway |2,407,238 |-199,674 |528,613 | -|199,142 |

|AS | | | | | | |

+-----------+-------------+----------+----------+-----------+---------+---------+

|Vallhall |Norway |737,348 |-11,504 |448,063 |3,915,586|6,645 |

+-----------+-------------+----------+----------+-----------+---------+---------+

|Vallhall |Norway |33,562,327|-6,070,541|13,621,883 |3,992,868|1,873,913|

|KS | | | | | | |

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|In total | |36 706 912|-6,281,719|14,598,558 |7,908,455|2 079 701|

| | | | | | | |

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4 BACKGROUND FOR AND CONSEQUENCES OF THE TRANSACTION

The Transaction implies that the Company is strengthening its investment

activities.

The purpose of the Transaction is to secure the development and increase of the

current core activities of the Company through an increase of ownership in

companies where the Company already has an ownership interest. The Transaction

will be fully financed with equity through an increase of the Company's share

capital. Following the demerger, the total book value of the Company's equity

will increase from MNOK 188.7 with MNOK 193.7 to an estimated total of MNOK

382.4.

The Board further considers that the transfer of the Assets to the Company

through the Transaction will strengthen the Company's influence over such Assets

and make the Company more attractive for existing and potential partners(such as

securities firms, shipyards, other contractors and banks).

5 RELATED PARTY TRANSACTION

As mentioned above, Mr. Spetalen is the sole shareholder of Ferncliff and as

consideration for the Assets to be transferred to the Company under the

Transaction, Mr. Spetalen will receive 89,056,319 new shares in the Company,

each with a par value of NOK 1. The Board has obtained an independent fairness

opinion from Swedbank in compliance with section 4 of the Norwegian Corporate

Governance Code.

Further, Mr. Spetalen is the Chairman of the Board of Directors of the Company.

The Transaction is thus a transaction between related parties. Mr. Spetalen has

not participated in the Board's discussion of the Transaction.

For further information, please contact:

CEO Espen Lundaas

+47 92 43 14 17

This information is subject of the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

[HUG#1838410]

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Saga Pure Capital/Financing Update 2014

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SAGA TANKERS ASA: DETAILED STOCK EXCHANGE ANNOUNCEMENT REGARDING DEMERGER OF CERTAIN ASSETS OWNED BY FERNCLIFF TIH 1 AS

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Saga Pure — Capital/Financing Update 2014

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SAGA TANKERS ASA: DETAILED STOCK EXCHANGE ANNOUNCEMENT REGARDING DEMERGER OF CERTAIN ASSETS OWNED BY FERNCLIFF TIH 1 AS

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