Announces Partial Spinoff

Hamilton, Bermuda, May 26, 2004 – Frontline Ltd. (NYSE:FRO; OSE:FRO) (“Frontline”) and its wholly-owned subsidiary, Ship Finance International Limited (“Ship Finance International”), today announced that Ship Finance International has filed a registration statement to register its common shares under the Securities Exchange Act of 1934.  Upon effectiveness of that registration statement, Ship Finance International’s common shares will be eligible for listing on the New York Stock Exchange.  Frontline expects to distribute approximately 25% of Ship Finance International’s common shares to Frontline’s common shareholders in a partial spinoff.  Each Frontline shareholder will receive one share in Ship Finance International for every four shares in Frontline held.  The record date for the distribution will be June 7, 2004, and the distribution date is expected to be June 16, 2004.  Due to the nature of the distribution the New York Stock Exchange is expected to establish the ex-dividend date as June 17, 2004, at which time the Ship Finance International common shares will commence trading under the ticker symbol “SFL”.

Frontline shareholders will not be required to take any action to receive the Ship Finance International common shares on the distribution date.  The Ship Finance International common shares are expected to begin trading on a “when-issued” basis on the New York Stock Exchange under the ticker symbol “SFL wi.”  During the “when-issued” period through the distribution date on June 16, 2004, Frontline common shares (NYSE ticker symbol “FRO”) will continue to include the right to receive Ship Finance International common shares and will continue to trade normally on the NYSE.  Shareholders should consult their financial advisors as to the effect of trading their Frontline shares before the ex-dividend date of June 17, 2004.  Frontline common shares without the right to receive Ship Finance International common shares (NYSE ticker symbol “FRO wi”) will also trade during the “when-issued” period.

 

Frontline and Ship Finance International are expected to announce their results for the first quarter of 2004 on May 28, 2004.

 

Ship Finance International owns a fleet of 47 oil tankers consisting of 23 very large crude carriers (“VLCCs”), including one VLCC subject to a purchase option on the part of Ship Finance International, and 24 Suezmax tankers,  Ship Finance International’s vessels are on time charter to and managed by subsidiaries of Frontline.

 

 

Ship Finance International has filed a registration statement, including a prospectus and other related documents, on Form F-4 with the United States Securities and Exchange Commission (the “SEC”) in connection with an exchange offer of senior notes by Ship Finance International that contains a prospectus describing Ship Finance International’s business.  In addition, Frontline expects to distribute an Information Statement to its shareholders in connection with the partial spinoff.

The registration statement is available on the following link:

This communication shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful under the securities laws of such jurisdiction.

This press release contains “forward looking statements” regarding the expected completion of the Ship Finance International exchange offer and partial spinoff.  These statements are subject to a number of risks and uncertainties that could cause these statements to be incorrect or actual results to differ materially.  These risks and uncertainties include changing market conditions in the tanker industry, market conditions for debt securities generally, securities issued by companies in the tanker industry and Ship Finance International securities specifically.  They are also subject to regulatory approvals which may affect the timing of the Ship Finance International partial spinoff.