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THE CREDIT CRUNCH AND SHIPBUILDING
World shipyards have a record order backlog. What effect will the global credit crunch have?

No effect
A slow down in new orders
Cancellation of some existing orders
Cancellation of many exisiting orders

Marine Log

April 2, 2008

Tidewater Holdings buys Foss Maritime upriver equipment

Vancouver, Washington, based Tidewater Holdings Inc. says it has reached a purchase agreement to acquire all upriver equipment from Foss Maritime Company.

Foss Maritime Company said that it has agreed to sell selected assets, including two tugs and twenty barges currently operating on the Columbia Snake River system, to Tidewater. It said it made the decision to sell the assets in order to focus its efforts and investment in its strategic lines of business including ship assist, ocean towing and special projects. Foss will maintain its Portland-based division and will no longer provide river barging of grain, wood products and containers.

The sale will help the company maintain its strategic focus and standards of quality, said Scott Merritt, Foss' Senior Vice President of Operations, citing the need for additional vessels and upgrades on its upriver tugs as contributing to the sale's timing.

"The most important thing for Foss is to ensure that we provide our customers with the highest quality service," said Mr. Merritt. "In order to do that with our upriver lines of business, we would need to make significant investments in new equipment. Unfortunately, in this competitive market, we were not likely to be able to recoup that investment."

Foss will complete any jobs that are in-process at the time of sale's close through a charter arrangement.

"We have enjoyed close working relationships with our upriver customers and will miss being a part of their success. However, we feel confident they will continue to find the services they require on the river. One of the most important criteria to us was selling the equipment to an operator that was interested in continuing to provide the services our customers need," said Gary Faber, President and COO of Foss Maritime.

Tidewater Holdings says the purchase continues to demonstrate its commitment to the Columbia-Snake River transportation system and the customers and communities served.

"We're excited that Tidewater's 75-year commitment and service continues to expand with added upriver equipment that will complement our current fleet and improve delivery of goods and services region-wide," said Dennis McVicker, Tidewater president and CEO.

Tidewater anticipates hiring a portion of Foss's workforce, as appropriate, following a review of the needs of the combined operations.

Tidewater and Foss personnel will work together through the transition to ensure uninterrupted service to the customers served by both companies.

Tidewater transports and stores petroleum products, bio-fuels, grain, fertilizer, export and solid waste containers, wood and paper products, and more, to and from the upriver Ports of Lewiston, Id., Pasco, Wash., and Umatilla and Boardman, Ore., as well as numerous grain elevators along the river system.

The equipment purchase comes at a time when the Portland metro area's regional planning agency, Metro, is considering Tidewater's bid to transport the area's solid waste by barge to the regional landfill in Gilliam County.

Tidewater Holdings Inc. -- Vancouver, Wash.-based Tidewater Barge Lines and Tidewater Terminal Company, and Troutdale, Ore.-based Sundial Marine Construction and Repair -- was founded in 1932 and is a Pacific Northwest leader in inland marine waterway transport, terminaling and construction. The company employs more than 300 employees in Washington, Oregon and Idaho and its operating area spans 465 miles on the Columbia and Snake River systems -- extending from the inland Port of Lewiston, Idaho, to the Port of Astoria, Ore., on the Pacific Coast. Its product transport includes biofuels, grain, refined petroleum products, containerized solid waste, liquid and dry fertilizers, and a wide variety of containerized freight for export. Tidewater is a member of American Waterways Operators (AWO).

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