P&O ACQUIRES 100% OF FAIRWAY TERMINAL CORPORATION

The Peninsular and Oriental Steam Navigation Company today
issued 269,153 units of deferred stock at a price of 625p each
to Cavalair Corporation (a company operating in Houston,
Texas) in consideration for the transfer by Cavalair of its
100% shareholding in Fairway Investment Inc. to ITO
Corporation (a subsidiary of P&O). Fairway Investment Inc.
owns a 331/3% interest in Fairway Terminal Corporation
(‘FTC’).

ITO Corporation had previously owned one-third of the issued
share capital in FTC and simultaneously with this transaction
also acquired the remaining third of the share capital of FTC
from Stevens Shipping and Terminal Company so that FTC is now
a 100% subsidiary of P&O. FTC is based in Houston, Texas and
provides terminal and stevedoring services throughout Texas.
The allotment of stock is conditional upon its admission to
the Official List being granted.

Further information:
Victoria Moth,
Corporate Communications Manager
0207 930 4343