Annual Reports & Accounts 2011

41 Events after balance sheet date

(a) Fire incident

Hull 107, a rig built by MIS and delivered to KSAM2 in 2010, suffered a major incident in January 2012 involving a fire and explosion whilst operating offshore in West Africa resulting in a total loss. The cause of the incident is currently under investigation. The Company, through MIS, holds a 10% equity interest in KSAM2, the owner of the rig. At the time of the incident the rig was on a bareboat charter by KSAM2 to a third party. KSAM2 carries hull and machinery insurance for the full market value of the rig and the Company is confident that recovery will be made pursuant to this insurance.

(b) Dividend

The Board of Directors of LEL has proposed a dividend of USD 425 per share amounting to USD 20.8m at a meeting held on 23 March 2012. In accordance with the accounting policy under IFRS set out at Note 2.16, this dividend has not been accrued at 31 December 2011. This is in accordance with the Isle of Man Companies (Amendment) Act 2010 which required that such proposed dividends should not be recognised until paid or approved by the shareholders.

Following the dividend from LEL, the Board of Directors of the Company has proposed a dividend of 8.0 US cents per share amounting to USD 20.8m at a meeting held on 23 March 2012. In accordance with the accounting policy under IFRS set out at Note 2.16, this dividend has not been accrued at 31 December 2011 (2010: 9.5 US cents per share amounting to USD 19m declared on 25 March 2011 was not accrued at 31 December 2010). This is in accordance with the Isle of Man Companies (Amendment) Act 2010 which required that such proposed dividends should not be recognised until paid or approved by the shareholders.