Ownership of the new company, Exmar LPG BVBA,will be split 50/50 between the Canadian and Belgian shipowners.

It will initially have a fleet of around twenty-threeships of which Exmar will contribute sixteen-owned vessels and the rest will bechartered-in tonnage.

TheExmar LPG BVBA fleet will include fifteen owned midsize gas carriers (MGC), ofwhich four are under construction at Hyundai Mipo Dockyard and one owned VLGC.

Itwill also time-charter in three MGCs and two VLGCs, and bareboat-charter in oneMGC and one VLGC.

TeekayLNG will contribute about $140m of equity and assume pro rata debt and lease obligationssecured by certain vessels to be owned by the new entity.

Priorto this transaction, Exmar LPG BVBA will acquire from Wah Kwong the remaining50% interest in two MGCs, the 35,440-cbm Brugge Venture (built 1997) and the 39,000-cbm Touraine (built 1996), which it doesnot already own.

Thejoint venture also said to have received a commitment from certain commerciallenders to refinance the fleet in early-2013.

Exmar,which will continue to commercially and technically manage and operate thevessels, says the intention is to renew and grow the fleet and that discussionsare already underway with various yards to secure additional orders.

“Newgas export projects scheduled to come on-line, combined with a relativelymodest LPG carrier orderbook, are expected to result in strong demand for thecurrent global LPG carrier fleet,” said Teekay chief executive Peter Evensen.

“Inaddition to providing potential upside from the attractive fundamentals in theLPG shipping market, this accretive transaction further diversifies Teekay LNG’sfixed-rate contract portfolio while leveraging Exmar’s deep expertise as aleading owner and operator of medium-sized gas carriers.”

Theproposed transaction, which is expected to close in late-2012 or early-2013,has been approved by the Teekay LNG and Exmar boards of directors, and remainssubject to customary closing conditions, including the completion of duediligence, vessel inspections and documentation.