Kathimerini S.A. is expanding its activities to include investments in tanker shipping, in an effort to secure a stable base of strong profitability in a period of instability in domestic and international markets.The company held an extraordinary meeting of shareholders today with a quorum of 80.06% of shares represented. The EGM decided that the Company would participate in tanker ship owning companies through a new fully owned subsidiary.The subsidiary will acquire two crude-oil Aframax tankers, ?Therassia? and ?Okeanis?. The two vessels have a displacement of 106,597 dwt each. They were built to the highest specifications by NKK Shipyards in Japan (among the 2-3 best shipyards worldwide) and were delivered in October and November 1997. The vessels carry the Greek flag, are of ultra-modern double-hull design and fulfill the most stringent crude oil transportation safety regulations, not least those enforced by the oil majors, such as Exxon Mobil, Shell, BP and Chevron.The two vessels are time-chartered under a three-year agreement to Exxon Mobil, i.e. their charter rates are insulated from market volatility. The daily rate has been fixed at $25,200 per vessel. The vessels' current combined market value is $84-85 million (c. GRD 31.9-32.2 billion), as valued by the internationally renowned shipbrokers H. Clarkson & Co. Ltd (UK) and R.S. Platou Shipbrokers a.s. (Norway). Kathimerini's subsidiary will acquire the two vessels for GRD 29.3 billion, for an immediate benefit of GRD 2.6-2.9 billion. The vessels will be bought for an equity consideration of GRD 9 billion contributed from the uninvested balance of GRD 10.82 billion remaining from the proceeds of Kathimerini's capital increase with the remaining GRD 20.3 billion provided by a syndicated loan led by Credit Agricole Indosuez. The spread over LIBOR is an especially competitive 1%. The vessels will be managed by Kyklades Maritime Corporation, which is controlled by Mr. Aristeides Alafouzos, the Chairman of the Board of Directors of Kathimerini.Kathimerini will enjoy fixed charter hire, the security provided by Exxon Mobil as a charterer and full insurance against risks as is standard for tanker shipping. The vessels' contribution to the net profits after tax of Kathimerini will be GRD 2.6 billion p.a., resulting in a 3.7-3.8 times increase over fiscal year 2000. As Mr. Aristeides Alafouzos explained, had the investment been completed in 1/1/2000, Kathimerini's net profits after tax for fiscal 2000 would have been approximately GRD 3.62 billion, i.e. GRD 976.6 million from existing activities and GRD 2.643 billion from the two vessels.Mr. Alafouzos emphasized that the company has made this investment decision based on ?the need to secure profitability in the current difficult economic environment, so that Kathimerini may retain its leading position in the field of publishing while providing high returns to its shareholders?(translated). Mr. Alafouzos explained the rationale for amending the company's investment plans, by stating the following: ?In mid-1999, Kathimerini made the decision to go public with definite equivocation. Kathimerini had always been a profitable company with sufficient capital to fund its traditional activities. However, when just about every other publishing company accessed the public markets and raised large amounts of equity capital to fund expansion in industrial printing, new publications and new media, Kathimerini had to follow suit in order to remain competitive. Indeed, we used a large portion of the proceeds of our capital increase to finance a number of investments in our traditional field of activity. However, we do not believe that, at present, we should be making further such investments, because the market for printing plant, new publications and new media is saturated. In particular, asset prices are extravagantly high and returns on equity are low. As a result, Kathimerini sought other opportunities to secure highreturns for its capital in investments with a low risk profile. Our view is that nearly all opportunities outside of public works and other government-related business have uncertain profitability prospects. Our view is that Kathimerini should not be involved in dealings with the government. We have agreed upon tanker shipping, where we enjoy both a long tradition and a 35-year history of personal involvement in the global crude oil tanker business. We have used our close ties with the oil majors to secure a three-year time charter agreement with Exxon Mobil, for the two ultra-modern tankers that Kathimerini will buy? (translated).Mr. Alafouzos wrapped up by saying that the fixed-income nature of this investment allows us to accurately pre-determine its impact on Kathimerini's profitability. Since this investment can be easily liquidated or its proceeds discounted by the banking sector, Kathimerini can at any time exploit any opportunities that may arise in its traditional sector.