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March 28, 2007
Kawasaki Kisen Kaisha, Ltd.

Joint Press Release by SAL and "K" Line

A new joint venture by German-based SAL Group (SAL), headed by Schiffahrtskontor Altes Land GmbH & Co KG and "K" Line Group ("K" Line), headed by Kawasaki Kisen Kaisha, Ltd., Tokyo, will inaugurate its joint operations in April 2007. In this new partnership the two companies, both renowned members of the worldwide ocean shipping industry, will collaborate together with the objective of further advancing the evolution of heavy lift shipping.

Founded in 1919, "K" Line is now a global-sized shipping company with highly-developed operations encompassing all sectors of the shipping industry. "K" Line has a fleet totalling over 440 vessels consisting of containerships, dry bulk and car carriers, oil tankers, LPG and LNG carriers, offering worldwide services in all major shipping lanes. SAL has an impressive history going back to 1838 when the first vessel was delivered to the Heinrich family by the German shipyard J.J. Sietas. Over the years, the company has grown into one of the world's leading carriers of heavy lift cargo. Since 2001, SAL has been under joint ownership and management of the Heinrich and Rolner families.

In the establishment of this new joint venture, "K" Line founded "K" Line Heavy Lift (UK) Ltd. that will purchase 50% of SAL's shares from the Heinrich and Rolner families. The joint venture will maintain the trade name of SAL out of respect for its significant market recognition in the realm of heavy lift shipping.

The new joint venture by these two shipping companies with their long histories will offer customers the benefit of the synergy from combining their wide and various stages of business. SAL's strength lies in its extensive experience in heavy lift shipping, while "K" Line's contribution emerges from its worldwide network together with its corporate commitment to strong relationships with customers all over the world, particularly with Japanese industries. This new joint venture will thus serve both existing and new emerging markets.

The two companies share the same dedication to Health, Safety and Environmental Management both onboard and ashore. This commitment is of particular significance with respect to the oil and gas industry which is increasingly being served by both SAL's heavy lifters and "K" Line's oil tankers and LNG carriers. It is the common intention of both parties to develop an operating scenario in which both parties will combine their respective skills, financial strengths and experience in shipping business, enabling SAL, the new joint venture, to achieve the role of being a highly-successful player in the heavy lift global shipping market. Both parties will be equally represented in the corporate structure as well as in the management of SAL.

Presently operating 15 heavy lifters, SAL also has a future fleet expansion program. In 2008, as the first phase, 4 newbuildings are to be delivered with service speed of 20 knots and equipped with cranes of 1,400 metric tons SWL as combined lifting capacity. The second phase will be achieved in 2009 and 2010 when another 2 newbuildings will be delivered with cranes having lifting capacity increased to 2,000 metric tons SWL on combination basis. Given the growing demand for offshore installation, the latter vessels will have the capacity to accommodate a Dynamic Positioning System (DP 2), enabling them to moor in close proximity to platforms and installation vessels.

The SAL main office will remain in Steinkirchen, about 30 miles from Hamburg, with "K" Line's officials to be assigned to that office, while SAL is planning to establish a branch office in "K" Line's Tokyo head office in order to assure closest possible cooperation in serving the Japanese market and in fully implementing all aspects of this new partnership.

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