Eimskipafélag Íslands hf. - Company Announcement

Eimskip and Royal Arctic Line A/S sign a Letter of Intent

Eimskip and Royal Arctic Line A/S have signed a letter of intent to connect
Greenland into Eimskip’s international sailing system through a capacity
sharing agreement, connecting Greenland to the rest of the world. The two
companies intend to work together through capacity sharing on larger vessels
that will increase efficiency and service reliability. 

The companies will invest in and operate container vessels designed and built
for the special weather conditions in the North Atlantic and the Arctic, in
accordance with the Polar Code. The new vessels will be designed for increased
fuel efficiency and will therefore be more environmentally friendly. The
estimated time of designing and building the vessels is two to three years. The
new vessels will connect the transport systems of Greenland and Iceland with
Scandinavia, Europe and North America. 

A final agreement on the cooperation will be subject to approval from the
parties’ Boards of Directors and the relevant authorities. 

Gylfi Sigfússon, President and CEO of Eimskip

“Planned port developments in Nuuk, Reykjavík and Tórshavn are enabling larger
vessel sizes to serve in the market area. By pooling Eimskip’s volumes with
Royal Arctic Line and using fewer and larger vessels facilitates efficiency
gains. The cooperation is an important step in renewal and development of
Eimskip’s vessel fleet and it expands the company’s coverage in the North
Atlantic. This will also, without any doubt, increase the business activities
between the countries in the Arctic.” 

Verner Hammeken, CEO of Royal Arctic Line

“This agreement is an important step for connecting Greenland to the global
markets. It creates opportunities for our export customers, allowing goods to
be further refined in Greenland before transporting them directly to
destinations all over the world in a more efficient way. Customers can also
select transportation directly from new market areas instead of having to go
through Denmark. With this, we are looking at a future with more options,
higher efficiency and ease of use, making it easy to do business with
Greenland.” 

About Royal Arctic Line

Royal Arctic Line A/S was founded in 1993 and is wholly owned by the Government
of Greenland. The Government of Greenland has given Royal Arctic Line A/S sole
concession on sea transport of cargo to and from Greenland and among
Greenlandic towns and settlements. This has made the company a lifeline for
Greenlandic society. Royal Arctic Line also operates 13 ports in Greenland. 

About Eimskip

Eimskip was founded in 1914 and is a publicly traded company with its shares
listed on Nasdaq Iceland. The company runs a network of 57 offices in 19
countries, operates 20 vessels and has about 1,580 employees. Approximately
half of Eimskip’s operating revenue comes from operations outside Iceland. The
company’s vision is to provide outstanding transportation services through a
dependable transport system in the North Atlantic, as well as offering an
extensive worldwide network of reefer logistics services. 

Eimskip has been an agent for Royal Arctic Line since 1993. Recently, the
cooperation has been extended by appointing TVG-Zimsen, Eimskip’s subsidiary,
as a forwarder of air-freight and trucking for Royal Arctic Line in Europe.