Teekay Corporation announced that it has reached an agreement in principle to acquire three floating production storage and offloading (FPSO) units from Sevan Marine ASA (Sevan), a Norway-based developer, owner and operator of FPSO units, and acquire an equity interest in a recapitalized Sevan.

Under the terms of the agreement in principle, which has been approved by the Teekay and Sevan boards of directors, Teekay will:

· Acquire from Sevan three FPSO units, the Hummingbird, Piranema and Voyageur (upon completion of upgrade), along with their existing charter contracts;

· Finance the completion of the Voyageur FPSO upgrade;

· Subscribe to a new issuance of Sevan equity to acquire a significant ownership position in a recapitalized Sevan; and

· Enter into a cooperation agreement to acquire future FPSO projects developed by Sevan.

“Our investment reflects our confidence in Sevan’s strong offshore project development expertise while providing Teekay with an enhanced pipeline of future on-the-water FPSO growth opportunities,” commented Peter Evensen, Teekay’s President and Chief Executive Officer. “Although the negotiation process has been complex, with many moving parts and counterparties, this is an important transaction for the FPSO industry and represents a rare opportunity to combine the bench strength of two leading specialty FPSO solution providers. The proprietary Sevan cylindrical hull is widely regarded as a safe, highly versatile, and flexible design that can be readily deployed in harsh or benign waters at water depths of up to 3,000 meters. Coupled with Teekay’s operational capabilities and balance sheet strength, Sevan’s engineering and offshore design capabilities and intellectual property represent a powerful FPSO project development combination.”

Teekay reached the agreement in principle for its participation in a consensual restructuring of Sevan's capital structure following discussions with Sevan's board of directors, some of its largest shareholders, and a group of bondholders holding a majority of each of Sevan's bond classes. The transaction remains subject to finalizing details and agreement of definitive documentation, in addition to formal approval by the bondholders in each of Sevan's bond classes, the approval from Sevan's shareholders, consent from Sevan FPSO charterers, and approvals by regulatory authorities. Prior and subsequent to the transaction closing, Sevan will continue operate as a publicly-listed company on the Oslo Børs. It is expected that the terms of the transaction will be announced during the week of October 3, 2011.