As filed with the U.S. Securities and Exchange Commission on February 4, 2014

Registration No. 333-

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933

Diamond S Shipping Group, Inc.

(Exact name of Registrant as specified in its charter)

	The Republic of the Marshall Islands			4412			Not Applicable
	(State or other jurisdiction of incorporation or organization)			(Primary Standard Industrial Classification Code Number)			(I.R.S. Employer Identification No.)

	c/o Diamond S Management LLC 33 Benedict Place Greenwich, CT 06830 (203) 413-2000			Florence Ioannou c/o Diamond S Management LLC 33 Benedict Place Greenwich, CT 06830 (203) 413-2000
	(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)			(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Randi L. Strudler
Jones Day
222 East 41st Street
New York, NY 10017
Tel: (212) 326-3939
Fax: (212) 755-7306

Michael Benjamin
Shearman & Sterling LLP
599 Lexington Avenue
New York, NY 10022
Tel: (212) 848-4000
Fax: (646) 848-7658

Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

	Large accelerated filer ☐						Accelerated filer ☐
	Non-accelerated filer ☒			(Do not check if a smaller reporting company)			Smaller reporting company ☐

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CALCULATION OF REGISTRATION FEE

	Title of Each Class of Securities to be Registered				Proposed Maximum Aggregate Offering Price(2)(3)					Amount of Registration Fee
	Common Shares, no par value(1)			$	100,000,000				$	12,880

(1)

In accordance with Rule 457(o) of the Securities Act of 1933, the number of common shares being registered and the proposed maximum offering price per share are not included in this table.

(2)

Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457 under the Securities Act of 1933.

(3)

Includes common shares that may be sold pursuant to the underwriters’ option to purchase additional shares.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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Subject to Completion dated February 4, 2014

PRELIMINARY PROSPECTUS

[MISSING IMAGE: lg_diamondshipping-4chires.jpg]

DIAMOND S SHIPPING GROUP, INC.

Common Shares

We are offering shares of our common stock. This is our initial public offering and no public market currently exists for our common shares. We expect the initial public offering price to be between $ and $ per common share. We have applied to list our common shares on the New York Stock Exchange under the symbol “DSG”.

Investing in our common shares involves a high degree of risk. Please read “Risk Factors” beginning on page 14 of this prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

We are an “emerging growth company” under the federal securities laws and will be subject to reduced public company reporting requirements.


Public offering price	$	$
Underwriting discount	$	$
Proceeds to the Company before expenses	$	$

Delivery of the common shares is expected to be made on or about , 2014. We have granted the underwriters an option for a period of 30 days to purchase an additional common shares. If the underwriters exercise the option in full, the total underwriting discounts and commissions payable by us will be $ , and the total proceeds to us, before expenses, will be $ .

Jefferies

BofA Merrill Lynch

Prospectus dated , 2014.

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You should rely only on information contained in this prospectus. Neither we nor the underwriters have authorized anyone to give any information or to make any representations other than those contained in this prospectus. Do not rely upon any information or representations made outside of this prospectus. This prospectus is not an offer to sell, and it is not soliciting an offer to buy, any securities other than our common shares or our common shares in any circumstances in which such an offer or solicitation is unlawful. The information contained in this prospectus may change after the date of this prospectus. Do not assume after the date of this prospectus that the information contained in this prospectus is still correct.

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	PROSPECTUS SUMMARY				1
	RISK FACTORS				14
	FORWARD-LOOKING STATEMENTS				36
	USE OF PROCEEDS				37
	OUR DIVIDEND POLICY				38
	CAPITALIZATION				39
	DILUTION				40
	SELECTED HISTORICAL FINANCIAL AND OTHER DATA				41
	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS				44
	THE PRODUCT TANKER INDUSTRY				69
	BUSINESS				90
	MANAGEMENT				107
	EXECUTIVE COMPENSATION				113
	PRINCIPAL SHAREHOLDERS				115
	RELATED PARTY TRANSACTIONS				117
	SHARES ELIGIBLE FOR FUTURE SALE				119
	DESCRIPTION OF OUR CAPITAL STOCK				121
	DESCRIPTION OF INDEBTEDNESS				124
	MARSHALL ISLANDS COMPANY CONSIDERATIONS				125
	TAX CONSIDERATIONS				127
	UNDERWRITING				133
	LEGAL MATTERS				139
	EXPERTS				139
	WHERE YOU CAN FIND ADDITIONAL INFORMATION				139
	ENFORCEABILITY OF CIVIL LIABILITIES				140
	GLOSSARY OF SHIPPING TERMS				141
	INDEX TO FINANCIAL STATEMENTS				F-1

Through and including , 2014 (the 25th day after the date of this prospectus), federal securities law may require all dealers that effect transactions in these securities, whether or not participating in this offering, to deliver a prospectus. This requirement is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

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INDUSTRY DATA

The discussions contained under the heading “The Product Tanker Industry” have been reviewed by Fearnley Consultants AS, or Fearnleys, which firm has confirmed to us that they accurately describe in all material respects the international tanker market as of the date of this prospectus.

The statistical and graphical information we use in this prospectus has been compiled by Fearnleys from its database and other sources, including independent industry publications, government publications and other published independent sources. Fearnleys compiles and publishes data for the benefit of its clients. Its methodologies for collecting data, and therefore the data collected, may differ from those of other sources, and its data do not reflect all or even necessarily a comprehensive set of the actual transactions occurring in the market. We believe that the information provided by Fearnleys is accurate in all material respects. In connection therewith, Fearnleys has advised that certain information in Fearnleys’ database is derived from estimates or subjective judgments; the information in the databases of other shipping data collection agencies may differ from the information in Fearnleys’ database; and while Fearnleys has taken reasonable care in the compilation of the statistical and graphical information and believes it to be accurate and correct, data compilation is subject to limited audit and validation procedures. Although data are taken from the most recently available published sources, these sources do revise figures and forecasts from time to time.

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PROSPECTUS SUMMARY

This section summarizes information that appears later in this prospectus. You should review carefully the risk factors and other more detailed information, as well as financial statements, included in this prospectus before making an investment decision. Diamond S Shipping Group, Inc. is a new holding company formed for our initial public offering that owns Diamond S Shipping III LLC and its subsidiaries and Diamond S Management LLC. Upon an internal reorganization prior to this offering, which we refer to as the “IPO Reorganization,” our ultimate parent, DSS Holdings L.P., which we refer to as “DSS Holdings,” will distribute our shares directly to its investors. As used in this prospectus, references to “DS Shipping I” refer to Diamond S Shipping I LLC, the immediate parent of Diamond S Shipping III LLC and a wholly-owned subsidiary of DSS Holdings prior to the IPO Reorganization. After the IPO Reorganization, DSS Holdings and its subsidiaries will be eliminated from our corporate structure. Additionally, as used in this prospectus, unless the context otherwise indicates, the references to “Diamond S Shipping,” “the Company,” “we,” “our,” and “us” refer collectively to Diamond S Shipping Group, Inc., Diamond S Shipping III LLC, Diamond S Shipping III LLC’s consolidated subsidiaries and Diamond S Management LLC. References to our “Manager” refer to Diamond S Management LLC. Diamond S Shipping III LLC and Diamond S Management LLC will no longer be subsidiaries of DSS Holdings following the IPO Reorganization. See the “Glossary of Shipping Terms” included in this prospectus for definitions of certain terms that are commonly used in the shipping industry.

Our Company

We provide seaborne transportation of refined petroleum and other products in the international shipping markets. We are one of the largest owners and operators of medium range, or MR, product tankers in the world, according to Fearnley Consultants AS, or Fearnleys. We employ a chartering strategy for the majority of our fleet which positions us to benefit from a freight rate recovery while maintaining an attractive base level of cash flow regardless of market conditions due to the fixed monthly revenue we receive from our time charter agreements.

Our current fleet currently consists of 33 MR product tankers built at leading Korean and Japanese shipyards. All of our product tankers in our current fleet are on the water today, trading in the market and earning revenue. Thirty of our MR product tankers are under time charters with the remaining three operating in the spot market. Our time charters have attractive fixed base rates for the life of the charters, and 20 of our time charters provide for profit-sharing. The fixed base rates provide us with stable cash flow and limit our exposure to rate volatility while the profit-sharing provisions allow us to share in the charterer’s voyage profits when spot rates, on a time charter equivalent basis, are higher than the base charter rates and our charterers are able to earn voyage profits in excess of that base charter on an annual basis. We do business with large, well-established charterers such as GlencoreXstrata, Trafigura Beheer BV, or Trafigura, A.P. Moller-Maersk A/S, or Maersk, and Tesoro Corporation, or Tesoro, Shell Tankers Singapore Ltd., or Shell, and Stena Weco A/S, or Stena, and their respective affiliates. As of December 31, 2013, the average remaining charter length of our fleet was two years.

We believe that there are significant growth opportunities to pursue in the current market environment, as asset values remain significantly below their historical averages and the product tanker market remains highly fragmented. As part of our growth strategy, we recently acquired three additional tankers from affiliates of CarVal Investors, LLC, or CarVal, an investment arm of Cargill, Incorporated. We plan to further expand our fleet, in part from proceeds of this offering, through the purchase of ten newbuild product tankers from a Korean shipyard that are scheduled to be delivered between September 2014 and January 2016, which we refer to as our “expansion fleet.” We intend to continue making modifications to our existing fleet that we believe have the potential to make our vessels as fuel efficient as the eco-ships currently being delivered. We believe we can effect these modifications without compromising our fleet’s ability to operate at higher speeds, which is an important factor in generating additional revenue in an improving freight rate environment. As the majority of our fleet is currently employed under time charters, we will consider installing any new technologies when the vessels trade in the spot market, are re-contracted or undergo scheduled drydocking.

Our management team strives to maintain high standards of performance, cost-efficient operations, reliability and safety in all of our operations. Chief Executive Officer Craig Stevenson, Jr. leads our management team and has over 40 years of experience in the shipping industry. Based on his previous experience as Chairman and Chief Executive Officer of OMI Corporation, or OMI, from 1998 through 2007, Mr. Stevenson and his team have developed strong relationships with charterers, financing sources, shipyards and other shipping industry participants. We intend to

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leverage the experience, reputation and relationships of our management team to pursue growth in the product tanker sector. Upon completion of this offering, our shareholders will include affiliates of WL Ross & Co. LLC, or WL Ross, funds affiliated with First Reserve Management, L.P., or First Reserve, and CarVal, an investment arm of Cargill, Incorporated.

For the year ended March 31, 2013 and the nine months ended December 31, 2013, we generated total revenue of $175.9 million and $134.4 million, respectively. Net income for the year ended March 31, 2013 and the nine months ended December 31, 2013 was $11.0 million and $2.3 million, respectively.

Market Opportunity

We believe that the following product tanker industry trends create attractive opportunities for us to successfully grow our fleet, based on information provided by Fearnleys.

Demand for seaborne transportation of refined products is increasing.

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Growing demand for oil products. Demand for product tankers is strengthening, given the recovery in global economic activity and industrial production, which continues to rely heavily upon oil and refined petroleum product consumption. Consumption in developing countries has been increasing due to growing demand for power generation, transportation and the development of infrastructure and raw materials.

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Growing distance between the location of refineries and consumption creates longer transportation distances. Aggregate seaborne transportation distances are increasing as larger and more efficient refineries are being built in geographic locations that are generally longer distances from the primary areas of refined product consumption. The complexity of the product tanker market with increasingly standardized cargo specifications and global price differentials has led to the development of an active trading market, which further bolsters ton-mile demand.

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Increasing U.S. refined product exports driven by production of U.S. shale oil deposits. The significant development of shale oil deposits in North America has resulted in a greater availability of crude feedstock particularly to refineries in the U.S. Gulf Coast, leading to a material increase in U.S. refined product exports.

The growth in the supply of ships that transport refined products has slowed.

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Decreasing orderbook for MR tankers. According to Fearnleys, the orderbook for MR product tankers greater than 35,000 dwt as a percentage of the overall fleet has declined from a peak of approximately 50% of the fleet during 2007 and 2008 to approximately 23.2% as of January 1, 2014. The supply growth (net of scrapping) for the entire MR fleet (including handysize) is estimated to be around 4% per annum over the next few years.

The product tanker market presents growth opportunities.

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Historically low vessel prices. Prices for second-hand vessels, newbuild and new orders for product tankers remain below historical averages.

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Market fragmentation. The product tanker industry is capital intensive and highly fragmented with significant opportunities for consolidation. More than 85% of the over 300 actively trading MR product tanker owners own fewer than 10 vessels.

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Focus on quality. Stringent customer standards favor larger, experienced operators with modern fleets and the ability to comply with increasingly rigorous and comprehensive environmental and regulatory requirements.

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Our Current Fleet

The following table summarizes key information about our MR product tankers and their associated charters as of December 31, 2013:

Vessel	Year Built	Shipyard	Capacity (DWT)	Employment Time/Spot	Charter Firm End(1)	Profit- Sharing(2)
Atlantic Lily	2008	Hyundai Mipo	47,128	Time	August 2015(3)	✓
Atlantic Olive	2008	Hyundai Mipo	47,128	Time	August 2015(3)	✓
Atlantic Rose	2008	Hyundai Mipo	47,128	Time	December 2015(3)	✓
Atlantic Titan	2008	Hyundai Mipo	47,128	Time	December 2015(3)	✓
High Jupiter	2008	STX	51,603	Time	October 2015(3)	✓
High Mars	2008	STX	51,542	Time	April 2015(3)	✓
High Mercury	2008	STX	51,501	Time	July 2015(3)	✓
High Saturn	2008	STX	51,527	Time	April 2015(3)	✓
Alpine Madeleine	2008	Hyundai Mipo	47,128	Time	July 2015(3)	✓
Alpine Magic	2009	Hyundai Mipo	47,128	Time	September 2016	✓
Alpine Mathilde	2008	Hyundai Mipo	47,128	Time	April 2015(3)	✓
Alpine Maya	2010	STX	51,500	Time	March 2017	✓
Alpine Melina	2010	STX	51,483	Time	March 2017	✓
Alpine Mia	2008	Hyundai Mipo	47,128	Time	December 2015	✓
Alpine Minute	2009	Hyundai Mipo	47,128	Time	March 2016	✓
Alpine Moment	2009	Hyundai Mipo	47,128	Time	January 2016	✓
Alpine Mystery	2009	Hyundai Mipo	47,128	Time	September 2016	✓
Atlantic Mirage	2009	STX	51,476	Time	July 2019	✓
Atlantic Muse	2009	STX	51,498	Time	February 2019	✓
Pacific Jewel	2009	Iwagi Zosen	48,012	Time	July 2019	✓
Atlantic Star	2008	Hyundai Mipo	47,128	Time	March 2015(3)
Atlantic Aquarius	2008	Hyundai Mipo	47,128	Time	July 2014
Atlantic Grace	2008	Hyundai Mipo	47,128	Time	March 2015
Adriatic Wave	2009	STX	51,549	Time	May 2015
Aegean Wave	2009	STX	51,510	Time	May 2015
Atlantic Gemini	2008	Hyundai Mipo	47,128	Time	May 2015
Atlantic Pisces	2009	Hyundai Mipo	47,128	Time	May 2015
Atlantic Breeze	2007	Hyundai Mipo	47,128	Time	March 2014
Citron	2007	Hyundai Mipo	46,968	Time	June 2014(3)
Citrus	2008	Hyundai Mipo	46,934	Time	August 2014(3)
Atlantic Frontier	2007	Hyundai Mipo	47,128	Spot
Atlantic Leo	2008	Hyundai Mipo	47,128	Spot
Atlantic Polaris	2009	Hyundai Mipo	47,128	Spot
Total: 33 Vessels			1,599,663

(1)

If our charterers exercise all of their extension options, the average remaining time charter length as of December 31, 2013 would be 3.2 years, during which period of time the average charter rate would be $16,231 per day.

(2)

Profit-sharing refers to a contractual arrangement contained in some of our charters to receive a pre-determined percentage of the charterer’s voyage profits in excess of the contractual base charter rate when the charterer’s voyage profits exceed the amount the charterer pays to us as the contractual base charter rate. This is calculated on an annual basis. The percentage we are entitled to receive under these profit-sharing provisions varies from charter to charter, from 40% to 50%. While there is no assurance that any charterer will realize charter rates that will produce sufficient profits during an annual period to trigger a profit-sharing provision, if any such charterer does so, we are entitled to receive the applicable percentage of its voyage profits beyond the base charter rate.

Charterers can earn voyage profits in excess of the base charter rate when spot rates, on a time charter equivalent basis, exceed the base charter rate and the charterer’s expenses. However, no charterer is under any contractual obligation to maximize its revenue or the spot rates it receives.

(3)

The time charter contract includes an extension option that may be exercised by the charterer.

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The following table summarizes the percentage of contracted revenue days to total revenue days for our fleet in each of the fiscal years ending March 31, 2014, 2015 and 2016, respectively, with the related average contracted charter rate in each of the respective periods:

Average Contracted Daily Time Charter Rates

Fiscal Year Ending	% of Available Days Contracted			Average Contracted Base Rate Per Day(1)
March 31, 2014	86	%	$	16,101
March 31, 2015	78	%	$	16,148
March 31, 2016	40	%	$	16,896

(1)

Does not include potential incremental revenue from profit-sharing or the exercise of any extension options.

Please see “Business—Our Fleet” and “Business—Our Customers” for additional information about the vessels in our fleet and our chartering arrangements.

Our Competitive Strengths

We believe that we possess a number of competitive strengths in our industry, including:

Significant operating experience and established track record. Our Chief Executive Officer, Craig Stevenson, Jr., has over 40 years of experience in the shipping industry and previously served as the Chief Executive Officer of OMI, a NYSE-listed tanker company, from 1998 through 2007. Mr. Stevenson was also previously the non-executive Chairman and subsequently a board member of Ship Finance International, a NYSE-listed diversified shipping company, until September 2009. Our Chief Operating Officer, Sanjay Sukhrani, has over 30 years of experience in the industry. He was previously the Vice President/General Manager of Gemini Tankers LLC, or Gemini Tankers, part of Teekay Corporation, or Teekay, was the Vice President of Operations at OMI and sailed for 17 years, including 5 years as a Master. Our Chief Financial Officer, Florence Ioannou, has over 24 years of experience working for a number of shipping companies, and was part of OMI’s financial management team for 18 years. Our Senior Vice President of Commercial Operations, Michael Fogarty, has over 23 years of experience in the shipping industry, and was previously responsible for chartering large fleets of both product and crude tankers at Gemini Tankers as well as at OMI.

Attractive fleet employment. We believe our current fleet is well positioned to capitalize on improving rates during a product tanker market recovery while also preserving a stable base of cash flow in any market conditions. Thirty of our MR product tankers are under time charters with three operating in the spot market. Our time charters have attractive fixed base rates for the life of the charters, and 20 of our time charters provide for profit-sharing. The fixed base rates provide us with stable cash flow and limit our exposure to rate volatility while the profit-sharing provisions allow us to share in the charterer’s voyage profits when spot rates, on a time charter equivalent basis, are higher than the base charter rates and our charterers are able to earn voyage profits in excess of that base charter on an annual basis. We expect to generate future minimum revenue from our existing contracted time charters of approximately $458 million in aggregate through the life of the time charter agreements: $154 million, $150 million and $81 million in each of the fiscal years ending March 31, 2014, 2015 and 2016, respectively, and $73 million in the fiscal years thereafter. These amounts exclude options on certain time charters that charterers have to extend the term of the charter arrangement and any incremental revenue from profit-sharing. We expect to employ the additional tankers we acquire in similar ways to benefit from improving rate environments while maintaining a base of stable cash flows.

Large, modern, high-quality fleet. Based on information provided by Fearnleys, we believe we are one of the largest owners and operators of MR product tankers in the world. Our current fleet consists of modern, homogeneous product tankers built at leading shipyards in Korea and Japan. The average age of our current fleet was 4.6 years as of December 31, 2013, compared to the industry average of 9.0 years for MR tankers greater than 35,000 dwt, according to Fearnleys. In addition, we plan to further expand our fleet through the purchase of ten newbuild product tankers from a Korean shipyard that are scheduled to be delivered between September 2014 and January 2016. We believe that our vessels provide our customers with high-quality and reliable transportation at competitive operating costs. Owning a modern fleet reduces off-hire time and maintenance, operating and drydocking costs and helps to improve safety and environmental performance.

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Established relationships with leading charterers. We have developed long-standing relationships with a number of leading tanker charterers, including international oil companies, oil traders, refiners and large vessel operators, which we believe will benefit us in the future as we continue to grow our business. We strive to maintain high standards of performance, cost-efficient operations, reliability and safety in all of our operations and to develop and maintain long-term relationships with our customers. We have signed charter party agreements with large global commodity trading companies such as GlencoreXstrata and Trafigura, one of the largest oil and gas shipping companies in the world, Maersk, an independent refiner and marketer of petroleum products, Tesoro, and Shell, a large oil major. We believe that our fleet is modern and of a high quality and that these characteristics, along with our management team’s experience in the industry, will allow us to continue to charter our vessels to leading counterparties.

Focus on service, health, safety and environmental excellence. Our focus on performance management has allowed us to achieve a high fleet availability of 99.7% over our entire fleet since we acquired our vessels through December 31, 2013, excluding time out of service for mandatory special surveys. We believe we have an excellent vessel safety record and are committed to providing our customers with a high level of customer service and support.

Competitive cost structure. We believe that as a result of the profile of our fleet, our large and experienced technical managers, and the hands-on approach of our management team, we have one of the lowest operating costs per vessel in the industry. Our fleet is currently managed by six leading third-party technical managers under the close supervision of our team. Our technical managers collectively manage in excess of 490 tankers, including our vessels. Our collaborative approach, which aggregates the experience and scale of our combined operations, creates a platform that delivers operational excellence at a very competitive cost.

Our Business Strategy

Acquisitions that maximize shareholders returns. We believe that there are significant growth opportunities to pursue in the current environment, as asset values remain significantly below historical averages and the product tanker market remains highly fragmented. As part of our growth strategy, we recently acquired three additional tankers from CarVal. We plan to further expand our fleet through the purchase of ten newbuild product tankers from a Korean shipyard that are scheduled to be delivered between September 2014 and January 2016.

Optimize the operating efficiency of our current fleet. Our goal is to optimize the operating efficiency of our fleet throughout the business cycle. As our ships complete their time charter contracts or undergo scheduled drydocking, or as we acquire new ships, we will consider making modifications to upgrade our fleet with the most recent fuel saving measures. We will consider proven, cost-effective technologies that would improve our return on investment and maintain our fleet’s operational flexibility. We believe that with these modifications we can potentially make our fleet as fuel efficient as the eco-ships currently being delivered without compromising our fleet’s ability to operate at higher speeds, which is an important factor in generating additional revenue in an improving freight market.

We believe that fuel efficiency and emissions reductions are core values that the market and our customers require, and we are committed to these objectives. We have evaluated and installed a variety of technologies and equipment on our existing fleet and will continue to evaluate other modifications and technology enhancements, including:

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fitting devices that reduce main engine fuel consumption without reducing available power and speed;

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fitting devices that improve fuel combustion and therefore fuel consumption for auxiliary equipment;

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efficient electrical power generation and usage;

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minimizing hull and propeller frictional losses;

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systems that allow for optimized routing; and

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systems that allow for improved maintenance, performance monitoring and management.

As part of our strategy, we will also continue to implement a competitive cost structure, engage consistently with our customers and shipyards to identify and select ships at attractive prices and operate a fleet management system that monitors and efficiently improves operational performance while keeping costs competitive.

Actively manage our exposure to the time and spot charter markets. Consistent with the track record of our management team, we will continue to pursue a strategy of mixing short- and long-term employment for our vessels to capture upside opportunities in the spot market while limiting our downside risk with fixed-rate time charters. We will seek to employ a greater portion of our vessels in the spot market based on market conditions upon the expiration of their existing charters. We will continue to charter a portion of our vessels under fixed-rate period charters with creditworthy and respected counterparties. We believe this strategy will allow us to capture increased profits, while benefiting from the stable cash flows and high utilization rates associated with long-term time charters.

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Our Manager

Our Manager provides us with commercial, technical and administrative services. Commercial services primarily involve business development, vessel chartering and service delivery. Technical services primarily include vessel operation, maintenance and crewing. Administrative services primarily include office, accounting, legal and insurance services. Prior to the IPO Reorganization, our Manager was a subsidiary of DSS Holdings and managed our vessels and vessels that DSS Holdings owns through other subsidiaries. Following the IPO Reorganization, our Manager will internally manage our vessels and will receive revenue for managing other vessels beneficially owned by DSS Holdings. From time to time, we, through our Manager, will employ agents to provide ship management services. We currently employ six large and experienced unrelated third-party technical managers, which primarily provide vessel operation, maintenance and crewing services. We pay our technical managers directly for their services. We closely supervise all third-party agents.

Our Shareholders

Our largest shareholders include WL Ross, First Reserve and CarVal. Upon completion of this offering, WL Ross will own approximately %, First Reserve will own approximately % and CarVal will own approximately % of us. Please see “Principal Shareholders” for a more detailed description of our share ownership following this offering.

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Condensed Corporate Structure

Diamond S Shipping Group, Inc., a corporation formed on July 31, 2013 under the laws of the Republic of the Marshall Islands, owns Diamond S Shipping III LLC and its subsidiaries as well as Diamond S Management LLC, our Manager. Immediately prior to the completion of this offering, we will complete the IPO Reorganization and DSS Holdings will distribute all of the outstanding common shares of Diamond S Shipping Group, Inc. to its existing shareholders. DSS Holdings and its subsidiaries will be eliminated from our corporate structure. The following chart reflects our condensed corporate structure after this offering.

[MISSING IMAGE: t1400069_chart-org01tg2.jpg]

We currently maintain our principal executive offices at c/o Diamond S Management LLC, 33 Benedict Place, Greenwich, CT 06830. Our telephone at this address is (203) 413-2000.

Our Dividend Policy

We do not anticipate declaring or paying any cash dividends to holders of our common shares in the near term. We currently intend to retain future earnings, if any, for use in the operation and expansion of our business. We may, however, adopt in the future a policy to pay cash dividends. Please see “Our Dividend Policy” later in this document for additional information regarding our dividend policy.

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Risk Factors

We face a number of risks associated with our business and industry and must overcome a variety of challenges to utilize our strengths and implement our business strategy. These risks include the following, among others:

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the cyclicality of the tanker industry;

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charter values, counterparty risks and customer relations;

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changing political and governmental conditions affecting our industry and business;

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changes in economic and competitive conditions affecting our business, including market fluctuations in charter rates, charterers’ abilities to perform under existing time charters and exchange rate fluctuations;

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applicable laws, regulations and taxes as well as changes in such laws and governmental regulations or actions taken by regulatory authorities;

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risks related to our recently formed company, its subsidiaries and our management;

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our fleet’s limited performance record, operating history and financial information;

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our liquidity, level of indebtedness, operating expenses, capital expenditures and financing;

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potential liability from future litigation and potential costs due to environmental damage and vessel incidents;

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partial dependence on spot charters;

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the length and number of off-hire periods and dependence on third-party technical managers;

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the impact of electing to take advantage of certain exemptions applicable to emerging growth companies; and

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risks related to war, terrorism and piracy.

This is not a comprehensive list of risks to which we are subject, and you should carefully consider all the information in this prospectus prior to investing in our common shares. In particular, we urge you to carefully consider the risk factors set forth in the section of this prospectus entitled “Risk Factors” beginning on page 14.

Implications of Being an Emerging Growth Company

As a company with less than $1.0 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies. As an emerging growth company,

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we may present only two years of audited financial statements and only two years of related Management’s Discussion & Analysis of Financial Condition and Results of Operations, or MD&A;

■

we are exempt from the requirement to obtain an attestation and report from our auditors on the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002;

■

we are permitted to provide less extensive disclosure about our executive compensation arrangements; and

■

we are not required to give our shareholders non-binding votes on executive compensation or golden parachute arrangements.

We may take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.0 billion in annual revenues, have more than $700.0 million in market value of our common shares held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period. We may choose to take advantage of some but not all of these reduced burdens.

Additionally, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. We have irrevocably elected not to avail ourselves of this exemption and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

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Recent Developments—The CarVal Transaction

On December 12, 2013, we acquired three vessel-owning companies from CarVal, each of which holds one modern MR product tanker. Upon closing of the transaction, we issued an 18.33% equity interest to CarVal in exchange for the three vessel-owning companies based on an aggregate valuation of $83.7 million. The $83.7 million valuation represented the aggregate charter-free appraised value of the vessels of $81.4 million, which was agreed in October 2013, plus $2.3 million of cash and working capital held by the vessel-owning companies at closing. We estimate that the average basic charter-free market value exceeded the average carrying value of these vessels by $0.8 million, or $2.4 million in the aggregate, as of December 31, 2013. The three vessels are currently employed under time charter agreements through March 2014, June 2014 and August 2014, respectively, assuming the charterers do not exercise options they have to extend the time charter agreements for two of the vessels.

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The Offering

Common shares presently outstanding(1)

common shares

Common shares to be offered

common shares

Option to purchase additional shares

We have granted the underwriters a 30-day option to purchase, from time to time, up to an additional common shares.

Common shares to be outstanding immediately after this offering

—assuming no exercise of option to purchase additional shares

common shares

—assuming full exercise of option to purchase additional shares

common shares

Use of proceeds

We intend to use the net proceeds from this offering to fund approximately $ million of the purchase price for ten newbuild product tankers being built by a Korean shipyard, with any remaining proceeds being used for other acquisition expenses and general corporate purposes. The acquisition of the contracts for the newbuildings are subject to customary closing conditions. Delivery dates for the vessels range from September 2014 through January 2016. We currently expect to finance the remaining portion under future credit facilities and from our future cash flow from operations. Currently, we do not have any commitments to finance the debt portion of the purchase price. The actual amount of the equity portion and debt portion under our purchase obligations could be impacted by the availability of debt financing on favorable terms.

Listing

We have applied to list our common shares on the New York Stock Exchange under the symbol “DSG.”

IPO Reorganization

Prior to the consummation of this offering, we will complete the IPO Reorganization. See “Summary—Condensed Corporate Structure” for a more detailed discussion of the IPO Reorganization.

Directed share program

At our request, the underwriters have reserved for sale at the initial public offering price up to 5% of the common shares for sale in this offering for our employees, directors and other persons associated with us who have expressed an interest in purchasing shares in the offering. The number of common shares available for sale to the general public in the offering will be reduced to the extent these parties purchase such directed shares. Any directed shares not so purchased will be offered by the underwriters to the general public on the same terms as the other shares offered by this prospectus. Shares purchased by the parties will be subject to the 180-day lock-up restriction described in the “Underwriting” section of this prospectus.

(1)

Gives effect to the IPO Reorganization.

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Summary Historical Financial and Other Data

The following table sets forth combined financial data and other operating data of Diamond S Shipping III LLC and Diamond S Management LLC. The combined financial data and other operating data for the nine months ended December 31, 2013 includes results or information on the 30 vessel-owning companies purchased from Cido Tanker Holding Co., or Cido, and the three ships we acquired on December 12, 2013 in the CarVal Transaction. The combined financial data in the table as of and for the fiscal years ended March 31, 2013 and 2012 include the 30 vessel-owning companies purchased from Cido and are derived from our audited combined financial statements, included elsewhere in this prospectus, and have been prepared in accordance with U.S. GAAP. The combined financial statements in the table for the nine months ended December 31, 2012 and for the nine months ended December 31, 2013 are derived from our unaudited combined financial statements, included elsewhere in this prospectus, and have been prepared in accordance with U.S. GAAP. References to the “Predecessor” refer to the combined accounts of the 30 vessel-owning companies prior to our acquiring them. The combined financial data for the period from April 1, 2011 to the Completion Date, included elsewhere in this prospectus, are derived from the Predecessor’s financial accounting records and have been prepared in accordance with U.S. GAAP. The Cido transaction refers to our acquisition of the 30 vessel-owning companies from Cido, and the Completion Date refers to the dates at which the vessel-owning companies were acquired by us. Twenty-seven of the vessels were delivered on September 27, 2011, and the remaining three were delivered on October 13, 2011. Revenues and expenses for the vessel-owning companies acquired have been reflected in the Predecessor financial statements through September 27, 2011 (for the 27 vessels acquired on that date) and October 13, 2011 (for the three vessels acquired on that date), and subsequent to those dates in vessel-owning companies owned by Diamond S Shipping III LLC. The data set forth below should be read in conjunction with the audited and unaudited combined financial statements, related notes and other financial information included elsewhere in this prospectus.

		Predecessor			Diamond S Shipping III LLC and Diamond S Management LLC
(U.S. dollars in thousands, except share and per share data)		April 1, 2011 to the Completion Date			For the Year Ended March 31, 2012(1)			For the Year Ended March 31, 2013			For the Nine Months Ended December 31, 2012			For the Nine Months Ended December 31, 2013
INCOME STATEMENT DATA
Voyage revenue	$	87,863		$	85,133		$	170,706		$	127,973		$	132,084
Service revenue		—			6,254			5,168			4,301			2,333
Total revenue		87,863			91,387			175,874			132,274			134,417
Operating expenses
Voyage expenses		671			710			7,094			1,997			13,198
Vessel expenses		30,735			32,074			67,431			49,654			50,374
Depreciation and amortization		30,487			22,598			45,241			33,863			35,545
Management fees		2,063			—			—			—			—
Settlement expenses		28,000			—			—			—			—
Acquisition costs		—			18,028			—			—			—
General and administrative expenses		—			9,722			11,727			8,333			9,597
Total operating expenses		91,956			83,132			131,493			93,847			108,714
Operating (loss)/income		(4,093	)		8,255			44,381			38,427			25,703
Other (expense) income
Interest expense		(12,757	)		(19,374	)		(33,403	)		(25,458	)		(23,465	)
Exchange loss, net		(11,756	)		—			—			—			—
Loss on early extinguishment of debt		(11,042	)		—			—			—			—
Other income		12			18			58			44			30
Total other expenses, net		(35,543	)		(19,356	)		(33,345	)		(25,414	)		(23,435	)
Net (Loss) Income	$	(39,636	)	$	(11,101	)	$	11,036		$	13,013		$	2,268
Pro Forma Net Earnings (Loss) Per Share(2)
Basic
Diluted
Pro Forma Weighted Average Shares Outstanding
Basic
Diluted

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		Diamond S Shipping III LLC and Diamond S Management LLC
		As of March 31,				As of December 31, 2013
(U.S. dollars in thousands)		2012		2013		As of December 31, 2013
BALANCE SHEET DATA
Cash and cash equivalents	$	49,514	$	38,772	$	34,596
Total current assets		59,905		57,303		50,268
Vessels—Net		1,064,463		1,019,933		1,068,543
Total assets		1,225,534		1,168,143		1,212,021
Current portion of long-term debt		59,938		62,173		62,918
Long-term debt		644,339		582,166		534,978
Total member’s equity		497,318		492,595		582,366

		Predecessor			Diamond S Shipping III LLC and Diamond S Management LLC
(U.S. dollars in thousands, except per day results)		April 1, 2011 to the Completion Date			For the Year Ended March 31, 2012(1)			For the Year Ended March 31, 2013			For the Nine Months Ended December 31, 2012			For the Nine Months Ended December 31, 2013
OTHER CASH FLOW DATA
Net cash (used in) provided by:
Operating activities	$	(13,933	)	$	19,038		$	66,544		$	53,910		$	35,180
Investing activities		11,558			(1,165,608	)		(1,805	)		(39	)		39
Financing activities		—			1,195,719			(75,481	)		(59,497	)		(39,394	)
Cash paid for drydocking		—			—			(1,877	)		(272	)		(10,932	)
Adjusted EBITDA(3)		54,372			34,711			99,009			78,398			66,770
OTHER DATA
Average number of owned vessels		30			15.2			30			30			30.2
Operating days(4)		5,448			5,532			10,950			8,250			8,307
Average TCE revenue per day(5)	$	16,095		$	16,076		$	16,052		$	16,064		$	15,596
Average daily vessel operating expenses(6)	$	5,642		$	5,798		$	6,158		$	6,019		$	6,064

(1)

For the period from April 1, 2011 to the Completion Date, the Company did not operate vessels. Twenty-seven vessels were acquired on September 27, 2011, and the remaining three vessels were acquired on October 13, 2011.

(2)

Pro forma basic and diluted earnings (loss) per share assumes million common shares were outstanding as of April 1, 2012. Prior to the IPO Reorganization, DS Shipping I was the sole member of Diamond S Shipping III LLC and held an undivided membership interest in Diamond S Shipping III LLC. For the periods presented, no basic earnings per share or diluted earnings per share can be calculated as DS Shipping I’s membership interest had not been partitioned into shares, units or any other metric. The IPO Reorganization is deemed to be a reorganization of entities under common control and historical weighted average shares outstanding have been retrospectively adjusted to reflect the impact of the IPO Reorganization.

(3)

Adjusted EBITDA is a non-GAAP financial measure that we define as net (loss) income before interest income and expense, taxes, depreciation and amortization and certain other adjustments, such as fair value of time charter amortization and straight-line charter hire revenue, that we exclude because they are non-cash items, which we believe are not indicative of the ongoing performance of our core operations. Adjusted EBITDA is a key metric we use to evaluate business performance in comparison to budgets, forecasts, prior year financial results and other companies in the shipping industry, providing a measure that we believe reflects our core operating performance. We believe that Adjusted EBITDA supplements our U.S. GAAP results to provide a more complete understanding of the results of our business and that Adjusted EBITDA is useful to our investors and other parties for these same reasons.

Adjusted EBITDA is not a measure of operating performance computed in accordance with U.S. GAAP and should not be considered as a substitute for net income or other measures of profitability. Although Adjusted EBITDA and similar non-GAAP measures are used by investors and others in our industry, there are limitations to using these non-GAAP measures and they should not be considered in isolation or as a substitute to our U.S. GAAP results of operations. These limitations include (1) other companies in our industry may define Adjusted EBITDA differently than we do and, as a result, it may not be comparable to similar measures reported by other companies in our industry and (2) Adjusted EBITDA may exclude certain financial information that some may consider important in evaluating our financial performance. Adjusted EBITDA may not be indicative of historical operating results, and we do not intend for it to be predictive of future results of operations.

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The following table represents a reconciliation of net (loss) income, which is the most directly comparable U.S. GAAP measure, to Adjusted EBITDA for the periods presented:

		Predecessor			Diamond S Shipping III LLC and Diamond S Management LLC
(U.S. dollars in thousands)		April 1, 2011 to the Completion Date			For the Year Ended March 31, 2012(1)			For the Year Ended March 31, 2013			For the Nine Months Ended December 31, 2012			For the Nine Months Ended December 31, 2013
Reconciliation of net (loss) income to adjusted EBITDA
Net (loss) income	$	(39,636	)	$	(11,101	)	$	11,036		$	13,013		$	2,268
Depreciation and amortization		30,487			22,598			45,241			33,863			35,545
Settlement expenses		28,000			—			—			—			—
Interest expense		12,757			19,374			33,403			25,458			23,465
Exchange loss		11,756			—			—			—			—
Extinguishment of debt		11,042			—			—			—			—
Fair value of acquired time charter amortization		—			4,977			10,305			7,360			4,925
Straight-line charter hire revenue		(22	)		(1,119	)		(918	)		(1,252	)		597
Other income		(12	)		(18	)		(58	)		(44	)		(30	)
Adjusted EBITDA	$	54,372		$	34,711		$	99,009		$	78,398		$	66,770

(4)

Operating days are the number of days our vessels operate during a fiscal year or period. We include days that the vessel is in drydock in our operating days as we are incurring operating expenses while in drydock.

(5)

Average TCE revenue per day is the average time charter equivalent (“TCE”) revenue which is equal to time charter and voyage revenue less voyage expenses, including bunkers and port charges, divided by total revenue days in the period. TCE is a standard measurement in the shipping industry to equate vessels that operate on voyage or spot charters with vessels operating on time charters. TCE revenue is a non-GAAP financial measure that excludes other non-cash adjustments, such as amortization of the fair value of the time charter contracts acquired in the Cido transaction.

The following table represents a reconciliation of voyage revenue to TCE revenue for the periods presented:

		Predecessor			Diamond S Shipping III LLC and Diamond S Management LLC
(U.S. dollars in thousands, except for days and daily averages)		April 1, 2011 to the Completion Date			For the Year Ended March 31, 2012(1)			For the Year Ended March 31, 2013			For the Nine Months Ended December 31, 2012			For the Nine Months Ended December 31, 2013
Reconciliation of voyage revenue to TCE revenue
Voyage revenue	$	87,863		$	85,133		$	170,706		$	127,973		$	132,084
Amortization of the fair value of time charter contracts		—			4,977			10,305			7,360			4,925
Adjustment for straight-line charter hire revenue		(22	)		(1,119	)		(918	)		(1,252	)		597
Voyage expenses(a)		(671	)		(710	)		(7,094	)		(1,997	)		(11,759	)
TCE Revenue		87,170			88,281			172,999		$	132,084		$	125,847
Revenue Days(b)		5,416			5,491			10,777			8,222			8,070
Average TCE Revenue per Day	$	16,095		$	16,076		$	16,052		$	16,064		$	15,596

(a)

Excludes a total of $1.4 million for the nine months ended December 31, 2013 in off-hire bunkers.

(b)

Revenue days represent the total number of days available for the vessels to earn revenue and are the total number of days our vessels were in our possession during a period, less the total number of off-hire days during the period including off-hire for major repairs, drydockings and special or intermediate surveys.

(6)

Average daily vessel operating expenses are computed by dividing the vessel expenses by the total number of operating days of the fleet.

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RISK FACTORS

Before making a decision to purchase our common shares, you should carefully consider the following risks, as well as the other information contained in this prospectus. Some of the following risks relate principally to the industry in which we operate and our business in general. Other risks relate principally to the securities market and ownership of our common shares. The occurrence of any of the events described in this section could significantly and negatively affect our business, financial condition, operating results or the trading price of our common shares.

RISKS RELATED TO OUR INDUSTRY

If the product tanker industry, which historically has been cyclical and volatile, does not continue to improve in the future, our earnings may be adversely affected.

The product tanker industry is cyclical and volatile in terms of charter rates and profitability, which may have future implications on our earnings. The product tanker industry is showing signs of recovery from a recent low point in its business cycle, but could relapse or cease to improve for a number of reasons.

A worsening of the current global economic conditions may adversely affect our ability to charter or re-charter our vessels or to sell them on the expiration or termination of their charters, and any renewal or replacement charters that we enter into may not be sufficient to allow us to operate our vessels profitably. Fluctuations in charter rates and vessel values result from changes in the supply and demand for tanker capacity and changes in the supply and demand for oil and oil products. The factors affecting the supply and demand for tankers are outside of our control, and the nature, timing and degree of changes in the petroleum industry conditions are unpredictable.

The factors that influence demand for tanker capacity include:

■

supply and demand for energy resources and oil and petroleum products;

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regional availability of refining capacity and inventories;

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global and regional economic and political conditions, including armed conflicts, terrorist activities, and strikes;

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the distance oil and oil products are moved by sea;

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changes in seaborne and other transportation patterns;

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environmental and other legal and regulatory developments;

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weather and natural disasters;

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competition from alternative sources of energy; and

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international sanctions, embargoes, import and export restrictions, nationalizations and wars.

The factors that influence the supply of tanker capacity include:

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supply and demand for energy resources and oil and petroleum products;

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charter and spot market rates;

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technological innovations;

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availability and cost of capital;

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the number of newbuild deliveries;

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the scrapping rate of older vessels;

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conversion of tankers to other uses;

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the number of vessels that are out of service;

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environmental concerns and regulations;

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port or canal congestion;

■

cost and supply of labor; and

■

currency exchange rate fluctuations.

Historically the tanker markets have been volatile as a result of the many conditions and factors that can affect the price, supply and demand for tanker capacity. The recent global economic downturn may further reduce demand for transportation of oil products and chemicals over longer distances. As of the date of this prospectus, 30 of our 33 MR product tankers operate on time charters, while the remaining three MR product tankers operate in the spot market. We will seek to employ a greater portion of our vessels in the spot market based on market conditions upon the expiration of their existing charters. If time charter or spot charter rates decline, we may be unable to achieve a level of charter hire sufficient for us to operate our vessels profitably.

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Demand for shipping of refined petroleum products could be significantly affected by volatile oil and gas prices and the overall demand for oil and gas.

Oil and gas prices are volatile and are affected by numerous factors beyond our control, including the following:

■

worldwide demand and global economic conditions;

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the cost of exploration, development, production, transportation and distribution of oil and gas;

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expectations regarding future energy prices for both oil and gas and other sources of energy;

■

the level of worldwide refined petroleum production and exports;

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government laws and regulations, including environmental protection laws and regulations;

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local, national and international political conditions, including military and non-military conflicts;

■

the weather and natural disasters; and

■

the availability and cost of alternative energy sources.

Increases in tanker capacity beyond scrap rates may affect our prospects.

The tanker market is affected by a number of factors, such as supply and demand for seaborne transportation of energy resources, the rate by which existing tankers are laid up or scrapped, changes in technology and customer demands and the rate of newbuildings. If the capacity of new tankers delivered exceeds the capacity of tankers being scrapped and converted to non-trading tankers, tanker capacity will increase. According to Fearnleys, as of January 1, 2014, the orderbook for MR product tankers greater than 35,000 dwt, which extends to 2017, equaled approximately 23.2% of the overall fleet. If the supply of tanker capacity increases and the demand for tanker capacity decreases or does not increase correspondingly, charter rates could decline, which could have a material adverse effect on our results of operations.

The spot market is volatile, and any decrease in spot charter rates in the future may adversely affect our earnings.

As of the date of this prospectus, we operate a fleet of 33 MR product tankers. Of those, three are currently employed in the spot market. We will seek to employ a greater portion of our vessels in the spot market based on market conditions upon the expiration of their existing charters. Additionally, we may employ additional vessels that we may acquire in the future in the spot charter market. Although spot chartering is common in the tanker industry, the spot market may fluctuate significantly based upon tanker and oil supply and demand. The successful operation of our vessels in the competitive spot market depends upon, among other things, obtaining profitable spot charters and minimizing, to the extent possible, time spent waiting for charters and time spent traveling unladen to pick up cargo. The spot market is volatile and, in the past, there have been periods when spot rates have declined below the operating cost of vessels. If future spot charter rates decline, we may be unable to operate our vessels trading in the spot market profitably or meet our obligations, including payments on indebtedness. Furthermore, as charter rates for spot charters are fixed for a single voyage which may last up to several weeks, during periods in which spot charter rates are rising, we will generally experience delays in realizing the benefits from such rate increases.

Additionally, as of December 31, 2013, 20 of our time charter agreements have profit-sharing provisions that allow us to share in the charterer’s voyage profits when spot rates, on a time charter equivalent basis, are higher than the base charter rates and our charterers are able to earn voyage profits in excess of that base charter on an annual basis. Consequently, a decline in spot charter rates when we are receiving profit-sharing revenue could have a material adverse effect on our results of operations.

We cannot predict whether our charterers will, upon the expiration of their charters, re-charter our vessels on favorable terms or at all. If our charterers decide not to re-charter our vessels, we may not be able to re-charter them on terms similar to our current charters or at all. In the future, we may also employ our vessels on the spot charter market, which is subject to greater rate fluctuation than the time charter market. If we receive lower charter rates under replacement charters or are unable to re-charter all of our vessels currently under charter and receive lower rates on the spot market, our earnings may be adversely affected.

We will not be able to take advantage of favorable opportunities in the spot market for vessels employed on medium to long-term time charters.

Future spot market rates are uncertain, and we will not be able to take advantage of favorable opportunities in the spot market for our vessels on time charter. As of December 31, 2013, we employed 30 tankers under fixed-rate time charter agreements with an average remaining duration of approximately 2 years, or approximately 3.2 years if all extension options

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are exercised. Vessels committed to medium- and long-term time charters may not be available for spot charters during periods of increasing charter hire rates, when spot charters might be more profitable than our current or future time charter agreements, even those with profit-sharing provisions.

Charter rates in our industry can fluctuate substantially, and declines in charter rates or other market deterioration could cause us to incur impairment charges.

We review the carrying values of our vessels for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Whenever certain indicators of potential impairment are present, such as projected undiscounted cash flows or vessel appraisals, we perform a test of recoverability of the carrying amount of the assets. The review for potential impairment indicators and projection of future cash flows related to the vessels is complex and requires us to make various estimates including future freight rates, residual values, future drydockings and operating costs, which are included in the analysis. All of these items have been historically volatile. We recognize an impairment charge if the carrying value is in excess of the estimated future undiscounted net operating cash flows. The impairment loss is measured based on the excess of the carrying amount over the fair market value of the asset.

We assess goodwill for impairment annually, or more frequently if impairment indicators arise. We are not required to calculate the fair value unless it is determined, based on a qualitative assessment, that it is more likely than not that the reporting unit’s fair value is less than its carrying amount. There are a number of events and circumstances for us to consider in conducting the qualitative assessment. If the qualitative assessment indicates the need for a formal impairment assessment, this is performed by comparing the estimated fair value of the reporting unit with its net book value. The Company derives the fair value of its reporting unit primarily based on discounted cash flow models. The process of evaluating the potential impairment of goodwill is highly subjective and requires significant judgment with respect to estimates of future cash flows expected to be generated and the appropriate discount rate to value these cash flows.

Although we believe that the assumptions used to evaluate potential impairment are reasonable and appropriate at the time they are made, such assumptions are highly subjective and likely to change, possibly materially, in the future. There can be no assurance as to how long charter rates and vessel values will remain at their current levels or whether they will improve by a significant degree. If charter rates were to remain at depressed levels, future assessments of vessel and goodwill impairments would be adversely affected. Any impairment charges incurred as a result of further declines in charter rates could negatively affect our business, financial condition, operating results or the trading price of our common shares.

The value of our vessels may fluctuate substantially, which could impact our ability to comply with the covenants in the MR Tanker Credit Facility (as defined in “Description of Indebtedness”) or future debt instruments and could cause us to incur a loss if we attempt to dispose of one or more of our vessels when ship values are depressed.

Values for ships can fluctuate substantially over time due to a number of factors, including:

■

prevailing economic conditions in the energy markets;

■

a substantial or extended decline in demand for refined products;

■

the level of worldwide refined product production and exports;

■

changes in the supply-demand balance of the global product tanker market;

■

changes in prevailing charter hire rates;

■

the physical condition of the ship;

■

the vessel’s size, age, technical specifications, efficiency and operational flexibility;

■

demand for refined product carriers; and

■

the cost of retrofitting or modifying existing ships, as a result of technological advances in ship design or equipment, changes in applicable environmental or other regulations or standards, customer requirements or otherwise.

A decline in the market value of our vessels could cause us to breach covenants in the MR Tanker Credit Facility or future debt instruments into which we may enter. If we do breach such covenants and we are unable to remedy the breach, our lenders could accelerate our indebtedness and seek to foreclose on the vessels in our fleet securing those debt instruments or seek other similar remedies. In addition, if a charter contract expires or is terminated by the charterer, we may be unable to re-charter the affected vessel at an attractive rate and, rather than continue to incur maintenance and financing costs for that vessel, we may seek to dispose of the affected vessel. Any foreclosure on our vessels or any disposal by us of a vessel at a time when the value of our vessels is depressed could materially and adversely affect our business, financial condition, results of operations and cash flows.

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The current state of the global financial markets and current economic conditions may adversely impact our ability to obtain additional financing on acceptable terms and otherwise negatively impact our business.

Global financial markets and economic conditions have been, and continue to be, volatile. In recent years, operating businesses in the global economy have faced tightening credit, weakening demand for goods and services, deteriorating international liquidity conditions, uncertain or rising interest rates, and declining markets. There has been a general decline in the willingness of banks and other financial institutions to extend credit, particularly in the shipping industry, due to the historically volatile asset values of vessels. As the shipping industry is highly dependent on the availability of credit to finance and expand operations, it has been negatively affected by this decline.

Also, as a result of concerns about the stability of financial markets generally and the solvency of counterparties specifically, the cost of obtaining money from the credit markets has increased as many lenders have increased interest rates, enacted tighter lending standards, refused to refinance existing debt at all or on terms similar to current debt and reduced, and in some cases ceased to provide, funding to borrowers. Due to these factors, additional financing may not be available if needed and to the extent required, on acceptable terms or at all. If additional financing is not available when needed, or is available only on unfavorable terms, we may be unable to expand or meet our obligations as they come due or we may be unable to execute our business plan, complete additional vessel acquisitions, such as our planned purchase of ten newbuild product tankers, or otherwise take advantage of business opportunities as they arise.

If economic conditions throughout the world do not improve, it will impede our operations.

Negative trends in the global economy that emerged in 2008 continue to adversely affect global economic conditions. In addition, the world economy continues to face a number of new challenges, including uncertainty related to the continuing discussions in the United States regarding the U.S. federal debt ceiling and mandatory reductions in federal spending, along with widespread skepticism about the implementation of any resulting agreements. These challenges also include continuing turmoil and hostilities in the Middle East, North Africa and other geographic areas and countries and continuing economic weakness in the European Union. There has historically been a strong link between the development of the world economy and demand for energy, including oil and refined products. An extended period of deterioration in the outlook for the world economy could reduce the overall demand for oil and refined products and for our services. Such changes could adversely affect our results of operations and cash flows.

The economies of the United States, the European Union and other parts of the world continue to experience relatively slow growth or remain in recession and exhibit weak economic trends. The credit markets in the United States and Europe have experienced significant contraction, de-leveraging and reduced liquidity, and the U.S. federal government and state governments and European authorities continue to implement a broad variety of governmental action and/or new regulation of the financial markets. Global financial markets and economic conditions have been, and continue to be, severely disrupted and volatile.

We face risks attendant to changes in economic environments, changes in interest rates and instability in the banking and securities markets around the world, among other factors. We cannot predict how long the current market conditions will last. However, these recent and developing economic and governmental factors, together with the concurrent decline in charter rates and vessel values, may have a material adverse effect on our results of operations and may cause the price of our common shares to decline.

Changes in fuel prices may adversely affect profits.

The cost of fuel, or bunkers, is a significant expense in our shipping operations for our vessels and changes in the price of fuel may adversely affect our profitability. Although the charterer is generally responsible for the cost and supply of fuel for our vessels employed on time charter, these fuel costs can affect the charter rates we are able to negotiate for our vessels. For our vessels in the spot market and under time charters with profit-sharing provisions, increases in fuel costs have a greater adverse impact on us. The price and supply of fuel is unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for oil and gas, actions by the Organization of the Petroleum Exporting Countries, or OPEC, and other oil and gas producers, war and unrest in oil producing countries and regions, regional production patterns and environmental concerns. Further, fuel may become much more expensive in the future, which may reduce the profitability and the competitiveness of our business versus other forms of transportation, such as truck or rail.

We are subject to complex laws and regulations, including environmental laws and regulations that can adversely affect our business, results of operations, cash flows and financial condition.

Our operations are subject to numerous laws and regulations in the form of international conventions and treaties, national, state and local laws and national and international regulations in force in the jurisdictions in which our vessels operate or

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are registered, which can significantly affect the ownership and operation of our vessels. These requirements include, but are not limited to, the U.S. Oil Pollution Act, the requirements of the U.S. Coast Guard and the U.S. Environmental Protection Agency, the U.S. Comprehensive Environmental Response, Compensation and Liability Act, the U.S. Clean Air Act, the U.S. Clean Water Act, the U.S. Maritime Transportation Security Act, European Union regulations, the International Labour Organization Maritime Labour Convention and the regulations of the International Maritime Organization. Compliance with such laws and regulations, where applicable, may require installation of costly equipment or operational changes and may affect the resale value or useful lives of our vessels. We may also incur additional costs in order to comply with other existing and future regulatory obligations, including, but not limited to, costs relating to air emissions including greenhouse gases, the management of ballast waters, maintenance and inspection, development and implementation of emergency procedures and insurance coverage or other financial assurance of our ability to address pollution incidents.

These costs could have a material adverse effect on our business, results of operations, cash flows and financial condition. A failure to comply with applicable laws and regulations may result in administrative and civil penalties, criminal sanctions or the suspension or termination of our operations. Environmental laws often impose strict liability for remediation of spills and releases of oil and hazardous substances, which could subject us to liability without regard to whether we were negligent or at fault. Under the U.S. Oil Pollution Act, for example, owners, operators and bareboat charterers are jointly and severally strictly liable for the discharge of oil within the 200-nautical mile exclusive economic zone around the United States (unless the spill results solely from the act or omission of a third party, an act of God or an act of war). An oil spill could result in significant liability, including fines, penalties, criminal liability and remediation costs for natural resource damages under other international and U.S. federal, state and local laws, as well as third-party damages, including punitive damages, and could harm our reputation with current or potential charterers of our tankers. We are required to satisfy insurance and financial responsibility requirements for potential oil (including marine fuel) spills and other pollution incidents. Although we have arranged insurance to cover certain environmental risks, there can be no assurance that such insurance will be sufficient to cover all such risks or that any claims will not have a material adverse effect on our business, results of operations, cash flows and financial condition.

If we fail to comply with international safety regulations, we may be subject to increased liability, which may adversely affect our insurance coverage and may result in a denial of access to, or detention in, certain ports.

The operation of our vessels is affected by the requirements set forth in the ISM Code. The ISM Code requires the owner of the ship or any other organization or person such as the manager, or the bareboat charterer, who has assumed the responsibility for operation of the ship from the shipowner and who, on assuming such responsibility, has agreed to take over all duties and responsibility imposed by the ISM Code, to develop and maintain an extensive “Safety Management System” that includes the adoption of a safety and environmental protection policy setting forth instructions and procedures for safe operation and describing procedures for dealing with emergencies. Our technical managers are responsible for complying with the provisions of the ISM Code and maintaining the relevant the certification for themselves and each of our vessels that are under their technical management. If we, our technical managers or our vessel crews fail to comply with the ISM Code, we may be subject to increased liability, our existing insurance may be invalidated or our affected vessels may experience a decrease in available insurance coverage. Such failure may result in a denial of access to, or detention in, certain ports.

If our vessels suffer damage due to the inherent operational risks of the tanker industry, we may experience unexpected drydocking costs and delays or total loss of our vessels, which may adversely affect our business and financial condition.

The operation of an ocean-going vessel carries inherent risks. Our vessels and their cargoes will be at risk of being damaged or lost because of maritime or non-maritime perils, such as marine disasters, bad weather and other acts of God, business interruptions caused by mechanical failures, grounding, fire, explosions and collisions, human error, war, terrorism, piracy and other circumstances or events. Changing economic, regulatory and political conditions in some countries, including political and military conflicts, have from time to time resulted in attacks on vessels, mining of waterways, piracy, terrorism, labor strikes and boycotts. These hazards may result in death or injury to persons, loss of revenues or property, the payment of ransoms, environmental damage, higher insurance rates, damage to our customer relationships, and market disruptions, delay or rerouting, which may also subject us to litigation. In addition, the operation of tankers has unique operational risks associated with the transportation of oil. An oil spill may cause significant environmental damage, and the associated costs could exceed the insurance coverage available to us. Compared to other types of vessels, tankers are exposed to a higher risk of damage and loss by fire, whether ignited by a terrorist attack, collision, or other cause, due to the high flammability and high volume of the oil transported in tankers.

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If our vessels suffer damage, they may need to be repaired at a drydocking facility. The costs of drydock repairs are unpredictable and may be substantial. We may have to pay drydocking costs that our insurance does not cover in full. The loss of revenues while these vessels are being repaired and repositioned, as well as the actual cost of these repairs, may adversely affect our business and financial condition. In addition, space at drydocking facilities is sometimes limited and not all drydocking facilities are conveniently located. We may be unable to find space at a suitable drydocking facility or our vessels may be forced to travel to a drydocking facility that is not conveniently located to our vessels’ positions. The loss of earnings while these vessels are forced to wait for space or to travel to more distant drydocking facilities may adversely affect our business and financial condition. Further, the total loss of any of our vessels could harm our reputation as a safe and reliable vessel owner and operator. If we are unable to adequately maintain or safeguard our vessels, we may be unable to prevent any such damage, costs, or loss which could negatively impact our business, financial condition and results of operations.

We operate our vessels worldwide and as a result, our vessels are exposed to international risks that may reduce revenue or increase expenses.

The international shipping industry is an inherently risky business involving global operations. Our vessels and their cargoes will be at risk of being damaged or lost because of maritime or non-maritime perils, such as marine disasters, bad weather, acts of God, business interruptions caused by mechanical failures, grounding, fire, explosions, collisions, human error, war, terrorism, piracy and other circumstances or events. In addition, changing economic, regulatory and political conditions in some countries, including political and military conflicts, have from time to time resulted in attacks on vessels, mining of waterways, piracy, terrorism, labor strikes and boycotts. These sorts of events could interfere with shipping routes and result in market disruptions which may reduce our revenue or increase our expenses.

International shipping is subject to various security and customs inspection and related procedures in countries of origin and destination and trans-shipment points. Inspection procedures can result in the seizure of the cargo and/or our vessels, delays in the loading, offloading or delivery and the levying of customs duties, fines or other penalties against us. It is possible that changes to inspection procedures could impose additional financial and legal obligations on us. Furthermore, changes to inspection procedures could also impose additional costs and obligations on our customers and may, in certain cases, render the shipment of certain types of cargo uneconomical or impractical. Any such changes or developments may have a material adverse effect on our business, results of operations, cash flows and financial condition.

Acts of piracy on ocean-going vessels could adversely affect our business.

Acts of piracy have historically affected ocean-going vessels trading in regions of the world such as the South China Sea, the Indian Ocean and in the Gulf of Aden. Sea piracy incidents continue to occur, particularly in the Gulf of Aden off the coast of Somalia and increasingly in the Gulf of Guinea, with drybulk vessels and tankers particularly vulnerable to such attacks. If these piracy attacks result in regions in which our vessels are deployed being characterized as “war risk” zones by insurers or Joint War Committee “war and strikes” listed areas, premiums payable for such coverage could increase significantly and such insurance coverage may be more difficult to obtain. In addition, crew costs, including costs which may be incurred to the extent we employ onboard security guards, could increase in such circumstances. We may not be adequately insured to cover losses from these incidents, which could have a material adverse effect on us. In addition, detention hijacking as a result of an act of piracy against our vessels, or an increase in cost, or unavailability of insurance for our vessels, could have a material adverse impact on our business, results of operations, cash flows and financial condition and may result in loss of revenues, increased costs and decreased cash flows to our customers, which could impair their ability to make payments to us under our charters.

Political instability, terrorist or other attacks, war or international hostilities may affect the tanker industry, which may adversely affect our business.

We conduct most of our operations outside of the United States, and our business, results of operations, cash flows and financial condition may be adversely affected by the effects of political instability, terrorist or other attacks, war or international hostilities. Continuing conflicts and recent developments in the Middle East and North Africa, including in Egypt, Syria, Iran, Iraq and Libya, and the presence of the United States and other armed forces in Afghanistan may lead to additional acts of terrorism and armed conflict around the world, which may contribute to further world economic instability and uncertainty in global financial markets. As a result of the above, insurers have increased premiums and reduced or restricted coverage for losses caused by terrorist acts generally. Future terrorist attacks could result in increased volatility of the financial markets and negatively impact the U.S. and global economy. These uncertainties could also adversely affect our ability to obtain additional financing on terms acceptable to us or at all.

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In the past, political instability has also resulted in attacks on vessels, such as the attack on the M/T Limburg, a very large crude carrier not related to us, in October 2002, mining of waterways and other efforts to disrupt international shipping, particularly in the Arabian Gulf region. Acts of terrorism and piracy have also affected vessels trading in regions such as the South China Sea and the Gulf of Aden off the coast of Somalia. Any of these occurrences could have a material adverse impact on our business, financial condition and results of operations.

If our vessels call on ports located in countries that are subject to sanctions and embargoes imposed by the U.S. and other governments, it could adversely affect our business, reputation and the market for our common shares.

From time to time, we have, or may in the future have, vessels call on ports located in countries subject to sanctions and embargoes imposed by the U.S. government and countries identified by the U.S. government as state sponsors of terrorism, such as Cuba, Iran, Sudan and Syria. Although these sanctions and embargoes may not prevent our vessels from making calls to ports in these countries, potential investors could view such port calls negatively, which could adversely affect our reputation, our ability to access U.S. capital markets and conduct our business, and could result in some investors deciding, or being required, to divest their interest, or not invest, in us. The determination by these investors not to invest in or to divest our common shares may adversely affect the price at which our common shares trade. Investor perception of the value of our common shares may be adversely affected by the consequences of war, the effects of terrorism, civil unrest and governmental actions in these and surrounding countries.

Although we believe we are, and have been, in compliance with applicable sanctions and embargo laws and regulations, and intend to maintain such compliance, there can be no assurance that we will be in compliance in the future, particularly as the scope of certain laws may be unclear or subject to changing interpretations. Moreover, our charterers may violate applicable sanctions and embargo laws and regulations as a result of actions that do not involve us or our vessels, and those violations could, in turn, negatively affect our reputation. Violations of sanctions and embargo laws can result in fines, exclusion from U.S. capital markets, exclusion from financial transactions subject to U.S. jurisdiction, and exclusion of that person’s vessels from U.S. ports for up to two years. Any such violations could negatively impact our business, reputation and the market for our common shares.

The smuggling of drugs or other contraband onto our vessels may lead to governmental claims against us.

We expect that our vessels will call in ports where smugglers attempt to hide drugs and other contraband on vessels, with or without the knowledge of crew members. To the extent our vessels are found with contraband, whether inside or attached to the hull of our vessel and whether with or without the knowledge of any of our crew, we may face governmental or other regulatory claims which could have an adverse effect on our business, results of operations, cash flows and financial condition.

Maritime claimants could arrest our vessels, which would have a negative effect on our cash flows.

Crew members, suppliers of goods and services to a vessel, shippers of cargo and other parties may be entitled to a maritime lien against a vessel for unsatisfied debts, claims or damages. In many jurisdictions, a maritime lien holder may enforce its lien by arresting or attaching a vessel through foreclosure proceedings. The arrest or attachment of one or more of our vessels could interrupt our business or require us to pay large sums of money to have the arrest lifted, which would have a negative effect on our cash flows.

In addition, in some jurisdictions, such as South Africa, under the “sister ship” theory of liability, a claimant may arrest both the vessel which is subject to the claimant’s maritime lien and any “associated” vessel, which is any vessel owned or controlled by the same owner. Claimants could try to assert “sister ship” liability against one vessel in our fleet for claims relating to another of our ships or for claims against ships not owned by us but owned by DSS Holdings. In addition, port authorities may seek to detain our vessels in port, which could adversely affect our operating results or relationships with customers.

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Governments could requisition our vessels during a period of war or emergency, which may negatively impact our business, financial condition and results of operations.

A government could requisition one or more of our vessels for title or hire. Requisition for title occurs when a government takes control of a vessel and becomes the owner. Also, a government could requisition our vessels for hire. Requisition for hire occurs when a government takes control of a vessel and effectively becomes the charterer at dictated charter rates. Generally, requisitions occur during a period of war or emergency. Government requisition of one or more of our vessels may negatively impact our business, financial condition and results of operations.

Technological innovation could reduce our charter hire income and the value of our vessels.

The charter hire rates and the value and operational life of a vessel are determined by a number of factors including the vessel’s efficiency, operational flexibility and useful life. Efficiency includes speed, fuel economy and the ability to load and discharge cargo quickly. Flexibility includes the ability to enter harbors, utilize related docking facilities and pass through canals and straits. The length of a vessel’s useful life is related to its original design and construction, its maintenance and the impact of the stress of operations. If new tankers are built that are more efficient or more flexible or have longer physical lives than our vessels, competition from these more technologically advanced vessels could adversely affect the amount of charter hire payments we receive for our vessels and the resale value of our vessels could significantly decrease, which would negatively impact our business, financial condition and results of operations.

If labor interruptions are not resolved in a timely manner, they could have a material adverse effect on our business, results of operations, cash flows and financial condition.

We, indirectly through our technical managers, employ masters, officers and crews to man our vessels. If not resolved in a timely and cost-effective manner, industrial action or other labor unrest could prevent or hinder our operations from being carried out as we expect and could have a material adverse effect on our business, results of operations, cash flows and financial condition.

RISKS RELATED TO OUR BUSINESS

We have a limited history of operations on which investors may assess our performance.

We acquired our MR product tankers in 2011. We have a limited performance record and operating history and, therefore, limited historical financial information upon which you can evaluate our operating performance or ability to implement and achieve our business strategy. We cannot assure you that we will be successful in implementing our business strategy.

The failure of our charterers to meet their obligations under our time charter agreements, on which we depend for a majority of our revenues, could cause us to suffer losses or otherwise adversely affect our business.

As of December 31, 2013, we employed 30 tankers under fixed-rate, long-term time charter agreements with an average remaining duration of approximately 2 years, or approximately 3.2 years if all extension options are exercised. When our existing time charter agreements expire and upon delivery of our vessels under construction or to be ordered, we may enter into new time charter agreements for periods of one year or longer. The ability and willingness of each of our counterparties to perform its obligations under a time charter agreement with us will depend on a number of factors that are beyond our control and may include, among other things, general economic conditions, the condition of the tanker shipping industry and the overall financial condition of the counterparties. Charterers are sensitive to the commodity markets and may be impacted by market forces affecting commodities. In addition, in depressed market conditions, charterers may seek to renegotiate their charters or default on their obligations under charters. Our customers may fail to pay charter hire or attempt to renegotiate charter rates.

When a counterparty fails to honor its obligations under agreements with us, it may be difficult to secure substitute employment for such vessel, and any new charter arrangements we secure in the spot market or on time charters may be at lower rates. In the future, if our charterers fail to meet their obligations to us or attempt to renegotiate our charter agreements, we could sustain significant losses, which could have a material adverse effect on our business, financial condition, results of operations and cash flows, as well as our compliance with the covenants in our MR Tanker Credit Facility.

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Our charterers may terminate or default on their charters, which could adversely affect our results of operations and cash flow.

Our charters may terminate earlier than the dates indicated in this prospectus. For example, in March 2013, Overseas Shipholding Group, Inc. and its subsidiaries (collectively, “OSG”) rejected their charter obligations on seven of our vessels in connection with their bankruptcy filings. The vessels we redeployed on time charter obtained charter rates that were lower than the OSG-contracted rates, for shorter terms and did not contain profit-sharing provisions. In addition to counterparty risk, the terms of our charters vary as to which events or occurrences will cause a charter to terminate or give the charterer the option to terminate the charter, but these generally include, but are not limited to, a total or constructive loss of the relevant vessel, the off-hire of the relevant vessel for a certain period of time or an event of war or hostilities between certain countries. In addition, the ability of each of our charterers to perform its obligations under a charter will depend on a number of factors that are beyond our control. These factors may include general economic conditions, the condition of the tanker industry, the charter rates received for specific types of vessels, various operating expenses for the charterer and the overall financial condition of our charterers. The costs and delays associated with the default by a charterer under a charter of a vessel may be considerable and may adversely affect our business, results of operations, cash flows and financial condition.

We rely on a limited number of customers. The loss of a key customer could result in a significant loss of revenue in a given period.

We have derived, and believe that we will continue to derive, a significant portion of our revenues from a limited number of customers. GlencoreXstrata, Maersk, d’Amico International Shipping, Hyundai Merchant Marine and OSG each individually accounted for more than 10%, and together accounted for 94.9%, of our voyage revenue during the fiscal year ended March 31, 2013. GlencoreXstrata, Maersk, d’Amico International Shipping and OSG each individually accounted for more than 10%, and together accounted for 90.3%, of our voyage revenue from the Completion Date to March 31, 2012. OSG rejected seven of our charter agreements and returned the vessels to us for redeployment during March and early April of 2013. In the future, the loss of any significant customer or a substantial decline in the amount of services requested by a significant customer could have a material adverse effect on our business, financial condition and results of operations.

Additionally, oil and natural gas companies, refineries and energy companies have undergone significant consolidation and additional consolidation is possible. Consolidation results in fewer companies to charter or contract for our services. Merger activity may result in a budget for a combined company that is less than the combined budget of the companies before consolidation. Future consolidation of our customer base could reduce demand for our vessels and have a material adverse effect on our business, financial condition and cash flows.

We may be unable to make, or realize the expected benefits from, our intended acquisition of ten newbuild product tankers and the failure to successfully implement our growth strategy through this acquisition could adversely affect our business, financial condition and operating results.

We are implementing our growth strategy through the purchase of ten newbuild product tankers from a Korean shipyard that are scheduled to be delivered between September 2014 and January 2016. These newbuild product tankers may not be profitable at or after the time of acquisition and may not generate cash flow sufficient to cover the cost of acquisition. Market conditions at the time of delivery may be such that charter rates are not favorable and the revenue generated by such vessels may not be sufficient to cover their purchase prices.

In addition, our acquisition and investment growth strategy exposes us to risks that could adversely affect our business, financial condition and operating results, including risks that we may:

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fail to realize anticipated benefits of acquisitions, such as new customer relationships, cost savings or increased cash flow;

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not be able to obtain charters at favorable rates or at all;

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be unable to hire, train or retain qualified shore and seafaring personnel to manage and operate our growing business and fleet or engage a third-party technical manager to do the same;

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not have adequate operating and financial systems in place as we implement our expansion plan;

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decrease our liquidity through the use of a significant portion of available cash or borrowing capacity to finance acquisitions;

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significantly increase our interest expense or financial leverage if we incur additional debt to finance acquisitions;

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incur or assume unanticipated liabilities, losses or costs associated with the business or vessels acquired; or

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incur other significant charges, such as impairment of goodwill or other intangible assets, asset devaluation or restructuring charges.

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We do not currently have debt or other financing committed to fund a significant portion of our expansion fleet.

We do not currently have debt or other financing committed to fund a significant portion of our expansion fleet. If we are not able to borrow additional funds, raise other capital, generate sufficient cash flow from operations or utilize available cash on hand, we may not be able to acquire these newbuilding vessels, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. We cannot assure you that we will be able to enter into any sufficient credit facilities on desirable terms or at all. If for any reason we fail to make a payment when due, which may result in a default under our newbuilding contracts, or otherwise fail to take delivery of our expansion fleet, we would be prevented from realizing potential revenues from these vessels, we could also lose all or a portion of any yard payments paid by us, and we could be liable for penalties and damages under such contracts.

Delays in deliveries of any of our ten newbuild product tankers, or delivery of any of the vessels with significant defects, could harm our operating results and lead to the termination of any related charters that may be entered into prior to their delivery.

The delivery of any of the ten newbuild product tankers we have ordered could be delayed, which would delay our receipt of revenues under any future charters we enter into for the vessels. In addition, some types of charters we may enter into for these newbuildings, if our delivery of a vessel to the charterer is delayed, could require us to pay liquidated damages in amounts equal to or, under some charters, almost double the hire rate during the delay. For prolonged delays, the charterer may terminate the time charter, resulting in loss of revenues. The delivery of any newbuild with substantial defects could have similar consequences.

Our receipt of newbuildings could be delayed because of many factors, including:

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quality or engineering problems;

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changes in governmental regulations or maritime self-regulatory organization standards;

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work stoppages or other labor disturbances at the shipyard;

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bankruptcy or other financial crisis of the shipbuilder;

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a backlog of orders at the shipyard;

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political or economic disturbances in the locations where the vessels are being built;

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weather interference or catastrophic event, such as a major earthquake or fire;

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our requests for changes to the original vessel specifications;

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shortages of, or delays in the receipt of necessary construction materials, such as steel;

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our inability to finance the purchase of the vessels; or

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our inability to obtain requisite permits or approvals.

We do not carry delay of delivery insurance to cover any losses that are not covered by delay penalties in our construction contracts. As a result, if delivery of a vessel is materially delayed, it could adversely affect our business, financial condition and operating results.

We may have difficulty managing our planned growth properly.

One of our principal strategies is to continue to grow by expanding our operations and adding to our fleet. Our future growth will primarily depend upon a number of factors, some of which may not be within our control. These factors include our ability to:

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identify suitable tankers and/or shipping companies for acquisitions at attractive prices;

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obtain required financing for our existing and new operations;

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identify businesses engaged in managing, operating or owning tankers for acquisitions or joint ventures;

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integrate any acquired tankers or businesses successfully with our existing operations, including obtaining any approvals and qualifications necessary to operate vessels that we acquire;

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hire, train and retain qualified personnel and crew to manage and operate our growing business and fleet;

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identify additional new markets;

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enhance our customer base; and

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improve our operating, financial and accounting systems and controls.

Our failure to effectively identify, purchase, develop and integrate additional tankers or businesses could adversely affect our business, financial condition and results of operations. The number of employees that perform services for us and our

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current operating and financial systems may not be adequate as we implement our plan to expand the size of our fleet, and we may not be able to effectively hire more employees or adequately improve those systems. Finally, future acquisitions may require additional equity issuances or debt issuances (with amortization payments). If any such events occur, our financial condition may be adversely affected.

Growing any business by acquisition presents numerous risks, such as undisclosed liabilities and obligations, difficulty in obtaining additional qualified personnel and managing relationships with customers and suppliers and integrating newly acquired operations into existing infrastructures. The expansion of our fleet may impose significant additional responsibilities on our management and the management and staff of our technical managers and may necessitate that we, and they, increase the number of personnel. We cannot give any assurance that we will be successful in executing our growth plans or that we will not incur significant expenses and losses in connection with our future growth.

If we purchase and operate second-hand vessels, we will be exposed to increased operating costs which could adversely affect our earnings and, as our fleet ages, the risks associated with older vessels could adversely affect our ability to obtain profitable charters.

Our current business strategy includes additional future growth through the acquisition of second-hand vessels, newbuild resales as well as vessel orders from shipyards. While we typically inspect second-hand vessels prior to purchase, this does not provide us with the same knowledge about their condition that we would have had if these vessels had been built for and operated exclusively by us. Generally, we do not receive the benefit of warranties from the builders for the second-hand vessels that we acquire.

In general, the costs to maintain a vessel in good operating condition increase with the age of the vessel. Older vessels are typically less fuel efficient than more recently constructed vessels due to improvements in engine technology.

Governmental regulations, safety or other equipment standards related to the age of vessels may require expenditures for alterations, or the addition of new equipment, to our vessels and may restrict the type of activities in which the vessels may engage. As our vessels age, market conditions may not justify those expenditures or enable us to operate our vessels profitably during the remainder of their useful lives.

Any vessel modification projects we undertake could have significant cost overruns, delays or fail to achieve the intended results.

Market volatility and higher fuel prices, coupled with increased regulation and concern about the environmental impact of the international shipping industry, have led to an increased focus on fuel efficiency. Many shipbuilders have implemented vessel modification programs for their existing ships in an attempt to capture potential efficiency gains. We will consider making modifications to our existing fleet where we believe the efficient gains will result in a positive return for our shareholders. However, these types of projects are subject to risks of delay and cost overruns, resulting from shortages of equipment, unforeseen engineering problems, work stoppages, unanticipated cost increases, inability to obtain necessary certifications and approvals, shortages of materials or skilled labor, among other problems. In addition, any completed modification may not achieve the full expected benefits or could even compromise our fleet’s ability to operate at higher speeds, which is an important factor in generating additional revenue in an improving freight rate environment. The failure to successfully complete any modification project we undertake or any significant cost overruns or delays in any retrofitting projects could have a material adverse effect on our financial position and results of operations.

We may experience operational problems with vessels that reduce revenue and increase costs.

MR product tankers are complex vessels and their operation is technically challenging. Marine transportation operations are subject to mechanical risks and problems, in addition to challenges resulting from harsh weather conditions on the high seas. Operational problems may lead to loss of revenue or higher than anticipated operating expenses or require additional capital expenditures. Any of these results could adversely affect our business, financial condition and operating results.

If we are unable to operate our vessels profitably, we may be unsuccessful in competing in the highly competitive international tanker market, which would negatively affect our financial condition and our ability to expand our business.

The operation of tanker vessels and transportation of petroleum products is extremely competitive, in an industry that is capital intensive and highly fragmented. Competition arises primarily from other tanker owners, including major oil companies as well as independent tanker companies, some of whom have substantially greater resources than we do.

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Competition for the transportation of oil and oil products can be intense and depends on price, location, size, age, condition and the acceptability of the tanker and its operators to the charterers. We may be unable to compete effectively with other tanker owners, including major oil companies as well as independent tanker companies.

Our market share may decrease in the future. We may not be able to compete profitably as we expand our business into new geographic regions or provide new services. New markets may require different skills, knowledge or strategies than we use in our current markets, and the competitors in those new markets may have greater financial strength and capital resources than we do.

Our growth depends on our ability to expand relationships with existing customers and obtain new customers, for which we will face substantial competition.

The process of obtaining new charters is highly competitive, generally involves an intensive screening process and competitive bids and often extends for several months. Contracts are awarded based upon a variety of factors, including:

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the operator’s industry relationships, experience and reputation for customer service, quality operations and safety;

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the operator’s construction management experience, including the ability to obtain on-time delivery of new vessels according to customer specifications;

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the quality and age of the vessels;

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the quality, experience and technical capability of the crew;

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the operator’s willingness to accept operational risks pursuant to the charter, such as allowing termination of the charter for force majeure events; and

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the competitiveness of the bid in terms of overall price.

Our ability to obtain new customers will depend upon a number of factors, including our ability to:

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successfully manage our liquidity and obtain the necessary financing to fund our anticipated growth;

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attract, hire, train and retain qualified personnel and technical managers to manage and operate our fleet;

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identify and consummate desirable acquisitions, joint ventures or strategic alliances; and

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identify and capitalize on opportunities in new markets.

We expect competition for providing transportation services from a number of experienced companies. As a result, we may be unable to expand our relationships with existing customers or to obtain new customers on a profitable basis, if at all, which would have a material adverse effect on our business, financial condition and operating results.

Our operating results are subject to seasonal fluctuations.

We operate our vessels in markets that have historically exhibited seasonal variations in demand and, as a result, in charter hire rates. The product tanker market is typically stronger in the winter months as a result of increased oil consumption in the northern hemisphere. In addition, unpredictable weather patterns in the fall and winter tend to disrupt vessel scheduling and supplies of certain petroleum products. The oil price volatility resulting from these factors has historically led to increased oil trading in the winter months. We could experience difficultly re-chartering our time charters that expire during the relatively weaker fiscal quarters ending June 30 and September 30 at similar rates or at all, which would adversely impact our business, financial condition and operating results.

Exchange rate fluctuations could adversely affect our revenues, financial condition and operating results.

We generate a substantial part of our revenues in U.S. dollars, but may incur costs in other currencies. The difference in currencies could in the future lead to fluctuations in our net income due to changes in the value of the U.S. dollar relative to other currencies. We have not hedged our exposure to exchange rate fluctuations, and as a result, our U.S. dollar denominated results of operations and financial condition could suffer as exchange rates fluctuate.

If we do not set aside funds and are unable to borrow or raise funds for vessel replacement, at the end of a vessel’s useful life our revenue will decline, which would adversely affect our business, results of operations and financial condition.

If we do not set aside funds and are either unable to borrow or raise funds for vessel replacement or can only do so at higher interest rates, we may be unable to replace some or all of the vessels in our current fleet upon the expiration of their remaining useful lives, which we expect to occur between 2032 to 2035, depending on the vessel. Our cash flows and

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income are dependent on the revenues earned by the chartering of our vessels. Higher interest rates would affect our financial condition even for vessels we are able to replace. If we are unable to replace the vessels in our fleet upon the expiration of their useful lives or can only do so at higher interest rates, our business, results of operations and financial condition would be adversely affected.

Our ability to obtain additional financing will depend on the performance of our business, our Manager and market conditions.

The actual or perceived credit quality of our business, our Manager and market conditions affecting the time charter, spot and credit markets may materially affect our ability to obtain the additional capital resources we will require to purchase additional vessels or may significantly increase the costs of obtaining such capital. Our inability to obtain additional financing at all or at a reasonable cost to us may materially affect our results of operation and our ability to implement our business strategy.

We are subject to certain risks with respect to our counterparties on contracts, and failure of such counterparties to meet their obligations could cause us to suffer losses or negatively impact our results of operations and cash flows.

We have entered into, and may enter in the future, various contracts. Such agreements subject us to counterparty risks. The ability of each of our counterparties to perform its obligations under a contract with us will depend on a number of factors that are beyond our control and may include, among other things, general economic conditions, the condition of the maritime and offshore industries, the overall financial condition of the counterparty, their compliance with the tax, environmental and other regulatory regimes they are subject to, charter rates received for specific types of vessels, and various expenses. As a result, our counterparties may seek to renegotiate the terms of their existing agreements or avoid their obligations under their contracts. Should a counterparty fail to honor its obligations under agreements with us, we could sustain significant losses which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our insurance may not be adequate to cover our losses that may result from our operations due to the inherent operational risks of the tanker industry.

We carry insurance to protect us against most of the accident-related risks involved in the conduct of our business, including marine hull and machinery insurance, protection and indemnity insurance, which include pollution risks, crew insurance and war risk insurance. However, we may not be adequately insured to cover losses from our operational risks, which could have a material adverse effect on us. Additionally, our insurers may refuse to pay particular claims and our insurance may be voidable by the insurers if we take, or fail to take, certain action, such as failing to maintain certification of our vessels with applicable maritime regulatory organizations. Any significant uninsured or under-insured loss or liability could have a material adverse effect on our business, results of operations, cash flows and financial condition. In addition, we may not be able to obtain adequate insurance coverage at reasonable rates in the future during adverse insurance market conditions which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Changes in the insurance markets attributable to terrorist attacks, piracy or environmental disasters may also make certain types of insurance more difficult for us to obtain due to increased premiums or reduced or restricted coverage for losses caused by terrorist acts, piracy or environmental disasters generally.

Because we obtain some of our insurance through protection and indemnity associations, which result in significant expenses to us, we may be required to make additional premium payments.

We may be subject to increased premium payments, or calls, in amounts based on our claim records, the claim records of our Manager or technical managers, as well as the claim records of other members of the protection and indemnity associations through which we receive insurance coverage for tort liability, including pollution-related liability. Our protection and indemnity associations may not have sufficient resources to cover claims made against them. Our payment of these calls could result in significant expense to us, which could have a material adverse effect on our business, results of operations, cash flows and financial condition.

Changes in the insurance markets or increased risks to other members of our protection and indemnity associations attributable to terrorist attacks, piracy, environmental disasters or other maritime and non-maritime perils may cause increases to premiums and may make certain types of insurance more difficult for us to obtain due to increased premiums or reduced or restricted coverage.

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Various tax rules may adversely impact our results of operations and financial position.

We may be subject to taxes in the United States and other jurisdictions in which we operate. If the Internal Revenue Service, or IRS, or other taxing authorities disagree with the positions we have taken on our tax returns, we could face additional tax liability, including interest and penalties. If material, payment of such additional amounts upon final adjudication of any disputes could have a material impact on our results of operations and financial position. In addition, complying with new tax rules, laws or regulations could impact our financial condition, and increases to federal or state statutory tax rates and other changes in tax laws, rules or regulations may increase our effective tax rate. Any increase in our effective tax rate could have a material impact on our financial results.

United States tax authorities could treat us as a “passive foreign investment company,” which could have adverse United States federal income tax consequences for U.S. shareholders.

A foreign corporation will be treated as a “passive foreign investment company,” or PFIC, for United States federal income tax purposes if either (1) at least 75% of its gross income for any taxable year consists of certain types of “passive income” or (2) at least 50% of the average value of the corporation’s assets produce or are held for the production of those types of “passive income.” For purposes of these tests, “passive income” includes dividends, interest and gains from the sale or exchange of investment property and rents and royalties other than rents and royalties which are received from unrelated parties in connection with the active conduct of a trade or business. For purposes of these tests, income derived from the performance of services does not constitute “passive income.” United States shareholders of a PFIC are subject to a disadvantageous United States federal income tax regime with respect to the income derived by the PFIC, the distributions they receive from the PFIC and the gain, if any, they derive from the sale or other disposition of their shares in the PFIC.

Based on current and anticipated operations, we do not believe that we are currently a PFIC or will be treated as a PFIC with respect to any future taxable year. Our belief is based principally on the advice we have received that the gross income we derive from our time chartering activities should constitute services income, rather than rental income. Accordingly, we intend to take the position that such income does not constitute passive income, and the assets that we own and operate in connection with the production of such income, in particular, the vessels, should not constitute passive assets for purposes of determining whether we are a PFIC. We believe there is substantial legal authority supporting this position, consisting of case law distinguishing service contracts from leases and IRS pronouncements concerning the characterization of income derived from time charters and voyage charters as services income for other tax purposes. However, it should be noted that there is also authority that characterizes time charter income as rental income rather than services income for other tax purposes. Accordingly, no assurance can be given that the IRS or a court of law will accept this position, and there is a risk that the IRS or a court of law could determine that we are a PFIC. Moreover, no assurance can be given that we would not constitute a PFIC for any future taxable year if the nature or extent of our operations change.

If the IRS were to find that we are or have been a PFIC for any taxable year, our United States shareholders would face adverse United States federal income tax consequences and incur certain information reporting obligations. Under the PFIC rules, unless those shareholders make an election available under the United States Internal Revenue Code of 1986, as amended, or the Tax Code (which election could itself have adverse consequences for such shareholders), such shareholders would be subject to United States federal income tax at the then prevailing maximum rates on ordinary income plus interest, in respect of excess distributions and upon any gain from the disposition of their common shares, as if the excess distribution or gain had been recognized ratably over the shareholder’s holding period of the common shares.

We may have to pay tax on U.S.-source shipping income, which would reduce our earnings.

Under the Tax Code, a foreign corporation that recognizes income attributable to transportation that begins or ends (but that does not begin and end) in the United States, as we and our subsidiaries do, may be subject to United States federal income taxation under one of two alternative tax regimes unless that corporation qualifies for exemption from tax under Section 883 of the Tax Code and the regulations promulgated thereunder by the United States Department of the Treasury: the 4% gross basis tax or the net basis tax and branch tax. The imposition of any such taxation would have a negative effect on our business and would decrease our earnings available for distribution to our shareholders. For a more detailed discussion, see the section titled “Tax Considerations—United States Federal Income Taxation of Operating Income: In General.”

We and our subsidiaries believe that we will be able, immediately following the offering, to qualify for this statutory tax exemption for United States federal income tax return reporting purposes. However, there can be no assurance that we will be able to satisfy the requirements for qualification under Section 883 of the Tax Code immediately after the offering or in

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the future, as there are factual circumstances beyond our control that could cause us to fail to qualify for or otherwise lose the benefit of this tax exemption and thereby become subject to United States federal income tax on our U.S.-source shipping income. For example, we may not qualify for exemption under Section 883 of the Tax Code for a particular taxable year if shareholders with a five percent or greater interest in our common shares directly owned, in the aggregate, 50% or more of our outstanding common shares for more than half the days during the taxable year (the shares directly owned by such shareholders hereinafter referred to as the “Closely-Held Block of Shares”), and there does not exist sufficient direct or indirect shareholders with respect to the aforementioned Closely-Held Block of Shares that are qualified shareholders for purposes of Section 883 of the Tax Code to preclude direct or indirect shareholders with respect to the aforementioned Closely-Held Block of Shares that are nonqualified shareholders from directly or indirectly owning 50% or more of our common shares for more than half the number of days during such taxable year. Furthermore, even if qualified shareholders own, directly or indirectly, sufficient shares of the company for the foregoing purpose, we may still be unable to qualify for exemption under Section 883 of the Tax Code if we cannot satisfy certain substantiation requirements with regard to our qualified shareholders. Due to the factual nature of the issues involved, there can be no assurances with respect to the eligibility of us or any of our subsidiaries for the exemption under Section 883 of the Tax Code. For a more detailed discussion, see the section entitled “Tax Considerations—Exemption of Operating Income from United States Federal Income Taxation.”

We are dependent on our third-party technical managers and other agents for the commercial, technical and administrative management of our business, and their ability to hire and retain key personnel, and the failure of our third-party technical managers and other agents to satisfactorily perform their services may adversely affect our business.

Each of our vessel-owning subsidiaries employs an unrelated third-party technical manager. Our success will depend upon our technical managers’ ability to hire and retain key personnel. The underperformance by these firms could adversely affect our business prospects and financial condition. The loss of any of our technical managers’ services or failure by any of our technical managers to perform its obligations could materially and adversely affect the results of our operations. If any of our technical management agreements were to be terminated or if any of their terms were to be altered, our business could be adversely affected, as we may not be able to immediately replace such services. Even if replacement services were immediately available, the terms offered could be less favorable than those under our current technical management agreements. Depending on the agreement, each of our technical management agreements terminates one, two or three months after one party, or both, provides written notice of its intent to terminate the agreement.

There may be conflicts of interest between us and our Manager that may not be resolved in our favor.

In addition to managing our vessels, our Manager also manages ships on behalf of DSS Holdings. Furthermore, through our Manager, our executive officers are also executive officers of DSS Holdings with the same titles and positions. Conflicts of interest may arise between our Manager’s obligations to other parties, on the one hand, and us or our shareholders, on the other hand. As a result of these conflicts, our Manager may favor the interests of other parties over our interests or those of our shareholders. This could have a material adverse effect on our business, results of operations, cash flows and financial condition.

Our technical managers are privately held companies and there is little or no publicly available information about them.

The ability of our technical managers to provide technical management services will depend in part on its own financial strength. Circumstances beyond our control could impair any of our technical managers’ financial strength, and because they are privately held companies, information about the financial strength of any of our technical managers is not publicly available. As a result, we and our shareholders might have little advance warning of financial or other problems affecting any of our technical managers even though their financial or other problems could have a material adverse effect on us.

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RISKS RELATED TO OUR INDEBTEDNESS

Servicing debt, which we may incur in the future, would limit funds available for other purposes and if we cannot service our debt, we may lose our vessels.

Borrowings under the MR Tanker Credit Facility, for which our subsidiary, Diamond S Shipping III LLC, is the parent guarantor, and any new credit facility or other debt financing instrument that we may enter into in the future (collectively, the “Diamond S Shipping Debt Instruments”) may require us to dedicate a part of our cash flow from operations to paying interest on the indebtedness in certain situations. These payments limit funds available for working capital, capital expenditures and other purposes, including further equity or debt financing in the future. Amounts borrowed under the Diamond S Shipping Debt Instruments bear interest at variable rates and are not completely hedged. Increases in prevailing rates could increase the amounts that we would have to pay to the lenders in certain situations, even though the outstanding principal amount remains the same, and our net income and cash flows would decrease. We expect our earnings and cash flow to vary from year to year due to the cyclical nature of the tanker industry. If we do not generate or reserve enough cash flow from operations to satisfy our debt obligations, we may have to undertake alternative financing plans, such as:

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seeking to raise additional capital;

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refinancing or restructuring our debt;

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selling tankers; or

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reducing or delaying capital investments.

However, these alternative financing plans, if necessary, may not be sufficient to allow us to meet our debt obligations. If we are unable to meet our debt obligations or if certain other events of default occur under the Diamond S Shipping Debt Instruments, the lenders could elect to declare that debt, together with accrued interest and fees, to be immediately due and payable and the lenders under the MR Tanker Credit Facility could proceed against the collateral vessels securing that debt even though the majority of the proceeds used to purchase the collateral vessels did not come from the MR Tanker Credit Facility.

The MR Tanker Credit Facility contains, and any new credit facility or other debt financing instrument is expected to contain, restrictive covenants which limit the amount of cash that Diamond S Shipping III LLC may use for other corporate activities, which could negatively affect our growth and cause our financial performance to suffer.

The MR Tanker Credit Facility imposes on Diamond S Shipping III LLC, and any new credit facility or other debt financing instrument that we may enter into in the future is expected to impose on us, operating and financial restrictions. These restrictions may limit our ability, or the ability of our subsidiaries party thereto to:

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pay dividends, if there is an event of default under the MR Tanker Credit Facility or dividends payable in the applicable fiscal year exceed 50% of the consolidated EBITDA of Diamond S Shipping III LLC and its consolidated subsidiaries;

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incur additional indebtedness, including the issuance of guarantees;

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create liens on our assets;

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change the flag or management of our vessels;

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sell our vessels;

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merge or consolidate with, or transfer all or substantially all our assets to, another person; or

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enter into a new line of business.

Therefore, we may need to seek permission from the lenders in order to engage in some corporate actions. The lenders’ interests may be different from ours and we may not be able to obtain the lenders’ permission when needed. This may limit our ability to pay dividends to you if we determine to do so in the future, finance our future operations or capital requirements, make acquisitions or pursue business opportunities.

We cannot assure you that we will be able to enter into any new credit facility or other debt financing instrument or that if we do so that we will be able to borrow all or any of the amounts committed thereunder.

We cannot assure you that we will be successful in entering into any new credit facility or other debt financing instrument to refinance our existing indebtedness. In addition, even if we enter into any new credit facility or new debt financing instrument, borrowings under any new credit facility or debt financing instrument may be subject to customary conditions

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for our industry, including that we may only use the credit facility or debt financing instrument to finance the lower of 50% of the fair market value or 50% of the purchase price of a vessel or must maintain a certain market value ratio. Accordingly, we cannot assure you that we will be able to satisfy such conditions or be able to borrow all or any of the amounts committed under any new credit facility debt financing instrument. If we are not able to enter into a new credit facility or debt financing instrument or are unable to borrow the amounts committed thereunder, our ability to execute our growth strategy may be materially adversely affected.

Our interest rate swap agreements are subject to counterparty risks and may be insufficient to protect us against volatility in LIBOR rates and amounts due under the MR Tanker Credit Facility.

We have partially hedged against the floating interest rate risks under the MR Tanker Credit Facility by being party to interest rate swap agreements with financial institutions. Changes in the fair value of these derivative financial instruments that are not cash flow hedges are reported in income and, accordingly, could materially affect our reported income in any period. Moreover, in light of current economic uncertainty, we may be exposed to the risk that one or more counterparties to our interest rate swap agreements may be unable to perform its obligations thereunder. LIBOR rates have recently been volatile, with the spread between those rates and prime lending rates widening significantly at times. These conditions are the result of the recent disruptions in the international credit markets. Amounts borrowed under the MR Tanker Credit Facility, which we have partially hedged, bear interest at an annual rate of 3.0% above LIBOR. If one or more of the counterparties to our interest rate swap agreements fails to perform its obligations thereunder, or if we choose not to, or are unable to, enter into such swap agreements for future debt instruments, we may be exposed to increased interest rates and additional interest rate volatility, which could have a material adverse effect on our results of operations and financial condition.

RISKS RELATED TO THIS OFFERING AND OUR COMMON SHARES

There is no guarantee that an active and liquid public market for our common shares will develop.

Prior to this offering, there has not been a public market for our common shares. The initial public offering price will be determined in negotiations between the representatives of the underwriters and us and may not be indicative of prices that will prevail in the trading market. The tanker industry has been highly unpredictable and volatile, and the market for common shares in this industry may be equally volatile. A liquid trading market for our common shares may not develop.

In the absence of a public trading market:

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you may not be able to liquidate your investment in our common shares;

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you may not be able to resell your shares at or above the initial public offering price;

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the market price of our common shares may experience more price volatility; and

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there may be less efficiency in carrying out your purchase and sale orders.

The price of our common shares after this offering may be volatile.

The price of our common shares may fluctuate due to a variety of factors, including:

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actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry;

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mergers and strategic alliances in the product tanker industry;

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market prices and conditions in the product tanker and oil industries;

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changes in government regulation;

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potential or actual military conflicts or acts of terrorism;

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natural disasters affecting the supply chain or use of petroleum products;

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the failure of securities analysts to publish research about us after this offering, or shortfalls in our operating results from levels forecast by securities analysts;

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announcements concerning us or our competitors; and

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the general state of the securities market.

As a result of these factors, investors in our common shares may not be able to resell their shares at or above the initial offering price. These broad market and industry factors may materially reduce the market price of our common shares, regardless of our operating performance.

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Reports published by analysts, including projections in those reports that exceed our actual results, could adversely affect the price and trading volume of our common shares.

We currently expect that securities research analysts, including those affiliated with our underwriters, will establish and publish their own periodic projections for our business. These projections may vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not match the projections of these securities research analysts. Similarly, if one or more of the analysts who write reports on us downgrades our stock or publishes inaccurate or unfavorable research about our business, our share price could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, our share price or trading volume could decline. While we expect research analyst coverage, if no analysts commence coverage of us, the trading price and volume for our common shares could be adversely affected.

There may be circumstances in which the interests of our significant shareholders could be in conflict with your interests as a shareholder.

WL Ross, First Reserve and CarVal will own %, % and %, respectively, of our outstanding common shares following the completion of this offering, assuming no exercise of the underwriters’ option to purchase additional shares. Circumstances may arise in which these shareholders may have an interest in pursuing or preventing acquisitions, divestitures or other transactions, including the issuance of additional shares or debt, that, in their judgment, could enhance their investment in us or another company in which they invest. Such transactions might adversely affect us or other holders of our common shares, including investors who purchase common shares in this offering. Further, holders of our common shares may have more difficulty in protecting their interests in connection with actions taken by our significant shareholders than they would as shareholders of a corporation incorporated in the United States.

In addition, our significant concentration of share ownership may adversely affect the trading price of our common shares because investors may perceive disadvantages in owning shares in companies with significant shareholders. See “Principal Shareholders” for a more detailed description of our share ownership.

We may issue additional common shares or other equity securities without your approval, which would dilute your ownership interests and may depress the market price of our common shares.

We may issue additional common shares or other equity securities of equal or senior rank in the future in connection with, among other things, future vessel acquisitions, repayment of outstanding indebtedness or our equity incentive plan, without shareholder approval, in a number of circumstances.

Our issuance of additional common shares or other equity securities of equal or senior rank would have the following effects:

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our existing shareholders’ proportionate ownership interest in us will decrease;

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the amount of cash available per share, including for payment of dividends in the future, may decrease;

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the relative voting strength of each previously outstanding common share may be diminished; and

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the market price of our common shares may decline.

Future sales of shares may cause the market price of our common shares to decline.

Sales of substantial amounts of our common shares in the public market after this offering, or the perception that these sales may occur, could adversely affect the price of our common shares and impair our ability to raise capital through the sale of additional equity securities. Upon completion of this offering, we will have common shares outstanding. Of these outstanding shares, the common shares sold in this offering will be freely tradable, without restriction, in the public market unless purchased by our “affiliates,” as defined under Rule 144 of the Securities Act or by our employees, directors and other persons associated with us pursuant to the directed share program described in the “Underwriting” section of this prospectus. The remaining common shares will be “restricted securities,” as that term is defined in Rule 144 under the Securities Act, which will be freely tradable subject to the applicable holding period, volume, manner of sale and other limitations under Rule 144 or Rule 701 of the Securities Act. Upon completion of this offering, the restricted securities will be subject to a lock-up agreement with the underwriters, restricting the sale of such shares for 180 days after the date of this offering. This lock-up agreement is subject to a number of exceptions, however, and holders may be released from this agreement with the prior written consent of the underwriters’ representatives.

We will incur increased costs and obligations as a result of being a public company.

As a privately held company, we were not required to comply with certain corporate governance and financial reporting practices and policies required of a publicly traded company. As a publicly traded company, we will incur significant legal,

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accounting and other expenses that we were not required to incur in the recent past, particularly after we are no longer an “emerging growth company” as defined under the JOBS Act. In addition, new and changing laws, regulations and standards relating to corporate governance and public disclosure, including the Dodd Frank Wall Street Reform and Consumer Protection Act and the rules and regulations promulgated and to be promulgated thereunder, as well as under the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, the JOBS Act, and the rules and regulations of the U.S. Securities and Exchange Commission, or the SEC, and the New York Stock Exchange, or the NYSE, have created uncertainty for public companies and increased our costs and the time that our board of directors and management must devote to complying with these rules and regulations. We expect these rules and regulations to increase our legal and financial compliance costs and lead to a diversion of management time and attention from revenue generating activities.

Furthermore, the need to establish the corporate infrastructure demanded of a public company may divert management’s attention from implementing our growth strategy, which could prevent us from improving our business, results of operations and financial condition. We have made, and will continue to make, changes to our internal controls and procedures for financial reporting and accounting systems to meet our reporting obligations as a publicly traded company. However, the measures we take may not be sufficient to satisfy our obligations as a publicly traded company.

For as long as we remain an “emerging growth company” as defined in the JOBS Act, we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” We may remain an “emerging growth company” for up to five years or until such earlier time that we have more than $1.0 billion in annual revenues, have more than $700.0 million in market value of our common shares held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three year period. Further, there is no guarantee that the exemptions available to us under the JOBS Act will result in significant savings. To the extent we choose not to use exemptions from various reporting requirements under the JOBS Act, we will incur additional compliance costs, which may impact earnings.

As an “emerging growth company,” we cannot be certain if the reduced disclosure requirements applicable to “emerging growth companies” will make our common shares less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to obtain an assessment of the effectiveness of our internal controls over financial reporting from our independent registered public accounting firm pursuant to Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common shares less attractive because we will rely on these exemptions. If some investors find our common shares less attractive as a result, there may be a less active market for our common shares and our share price may be more volatile.

In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of these accounting standards until they would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this exemption and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Pursuant to the recently enacted JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 for so long as we are an “emerging growth company.”

Section 404 of the Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal control over financial reporting, starting with the second annual report that we file with the SEC after the consummation of our initial public offering, and generally requires in the same report a report by our independent registered public accounting firm on the effectiveness of our internal control over financial reporting. However, under the recently enacted JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act until we are no longer an “emerging growth company.” We could be an “emerging growth company” for up to five years.

If we do not develop and implement all required accounting practices and policies, we may be unable to provide the financial information required of a U.S. publicly traded company in a timely and reliable manner.

Prior to this offering, we did not adopt all of the financial reporting and disclosure procedures and controls required of a U.S. publicly traded company because we were a privately held company. We expect that the implementation of all required

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accounting practices and policies and the hiring of additional financial staff will increase our operating costs and could require significant time and resources from our management and employees. If we fail to develop and maintain effective internal controls and procedures and disclosure procedures and controls, we may be unable to provide financial information and required SEC reports that a U.S. publicly traded company is required to provide in a timely and reliable fashion. Any such delays or deficiencies could penalize us, including by limiting our ability to obtain financing, either in the public capital markets or from private sources and hurt our reputation and could thereby impede our ability to implement our growth strategy. In addition, any such delays or deficiencies could result in our failure to meet the requirements for continued listing of our common shares on the NYSE.

Our internal control over financial reporting does not currently meet the standards required by Section 404 of the Sarbanes-Oxley Act of 2002, and failure to achieve and maintain effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and share price.

As a privately held company, we have not been required to evaluate our internal control over financial reporting in a manner that meets the standards of publicly traded companies required by Section 404(a) of the Sarbanes-Oxley Act. We anticipate being required to meet these standards in the course of preparing our consolidated financial statements as of and for the year ended March 31, 2015, and our management will be required to report on the effectiveness of our internal control over financial reporting for such year. Additionally, once we are no longer an “emerging growth company,” our independent registered public accounting firm will be required to attest to the effectiveness of our internal control over financial reporting on an annual basis. The rules governing the standards that must be met for our management to assess our internal control over financial reporting are complex and require significant documentation, testing and possible remediation.

In connection with the implementation of the necessary procedures and practices related to internal control over financial reporting, we may identify deficiencies that we may not be able to remediate in time to meet the deadline imposed by the Sarbanes-Oxley Act for compliance with the requirements of Section 404. In addition, we may encounter problems or delays in completing the implementation of any requested improvements and receiving a favorable attestation in connection with the attestation provided by our independent registered public accounting firm. We will be unable to issue securities in the public markets through the use of a shelf registration statement if we are not in compliance with Section 404. Furthermore, failure to achieve and maintain an effective internal control environment could have a material adverse effect on our business and share price and could limit our ability to report our financial results accurately and timely.

You will experience immediate and substantial dilution of $ per common share.

The assumed initial public offering price of $ per common share, which represents the midpoint of the price range set forth on the cover of this prospectus, exceeds the pro forma net tangible book value per common share immediately after this offering. Based on an assumed initial public offering price of $ per common share, which represents the midpoint of the price range set forth on the cover of this prospectus, you will incur immediate and substantial dilution of $ per share. Please read “Dilution” for a more detailed description of the dilution that you will experience upon the completion of this offering.

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Certain provisions of our amended and restated articles of incorporation, which we refer to as our articles of incorporation, and our bylaws may make it difficult for shareholders to change the composition of our board of directors and may discourage, delay or prevent a merger or acquisition that some shareholders may consider beneficial.

Certain provisions of our articles of incorporation and bylaws may have the effect of delaying or preventing changes in control if our board of directors determines that such changes in control are not in the best interests of the Company and our shareholders. The provisions in our articles of incorporation and bylaws include, among other things, those that:

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provide for a classified board of directors with three-year staggered terms;

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authorize our board of directors to issue preferred shares and to determine the price and other terms, including preferences and voting rights, of those shares without shareholder approval;

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establish advance notice procedures for nominating directors or presenting matters at shareholder meetings;

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authorize the removal of directors only for cause and only upon the affirmative vote of the holders of at least 80% of the outstanding shares entitled to vote for those directors;

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allow only our board of directors to fill vacancies on our board of directors;

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limit the persons who may call special meetings of shareholders; and

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require a super-majority to amend certain provisions of our bylaws and our articles of incorporation.

While these provisions have the effect of encouraging persons seeking to acquire control of our company to negotiate with our board of directors, they could enable the board of directors to hinder or frustrate a transaction that some, or a majority, of the shareholders may believe to be in their best interests and, in that case, may prevent or discourage attempts to remove and replace incumbent directors.

These provisions may frustrate or prevent any attempts by our shareholders to replace or remove our current management by making it more difficult for shareholders to replace members of our board of directors, which is responsible for appointing the members of our management. For more information, see “Description of Our Capital Stock.”

We have no present intention to pay dividends and, even if we change that policy, we may be restricted from paying dividends on our common shares.

As a holding company, we will depend on our subsidiaries’ ability to pay distributions to us to pay cash dividends to holders of our common shares. We do not anticipate declaring or paying cash dividends to holders of our common shares in the near term. We currently intend to retain future earnings, if any, for use in the operation and expansion of our business. We may, however, adopt in the future a policy to make cash dividends. Our future dividend policy is within the discretion of our board of directors. However, any future payment of dividends may be restricted by the covenants contained in the MR Tanker Credit Facility. Any determination to pay or not pay cash dividends will also depend upon then-existing conditions, including our results of operations, financial condition, capital requirements, investment opportunities, statutory and contractual restrictions on our ability to pay dividends and other factors our board of directors may deem relevant. In addition, Marshall Islands law generally prohibits the payment of dividends other than from surplus (retained earnings and the excess of consideration received for the sale of shares above the par value of the shares), when a company is insolvent or if the payment of the dividend would render the company insolvent.

We are incorporated in the Republic of the Marshall Islands, which does not have a well-developed body of corporate or bankruptcy law and, as a result, shareholders may have fewer rights and protections under Marshall Islands law than under a typical jurisdiction in the United States.

Our corporate affairs are governed by our articles of incorporation and bylaws and by the Marshall Islands Business Corporations Act, or the BCA. The provisions of the BCA resemble provisions of the corporation laws of a number of states in the United States. However, there have been few judicial cases in the Republic of the Marshall Islands interpreting the BCA. The rights and fiduciary responsibilities of directors under the law of the Republic of the Marshall Islands are not as clearly established as the rights and fiduciary responsibilities of directors under statutes or judicial precedent in existence in certain U.S. jurisdictions. Shareholder rights may differ as well. While the BCA does specifically incorporate the non-statutory law, or judicial case law, of the State of Delaware and other states with substantially similar legislative provisions, our public shareholders may have more difficulty in protecting their interests in the face of actions by management, directors or significant shareholders than would shareholders of a corporation incorporated in a U.S. jurisdiction. Additionally, the Republic of the Marshall Islands does not have a legal provision for bankruptcy or a general statutory mechanism for insolvency proceedings. As such, in the event of a future insolvency or bankruptcy, our shareholders and creditors may experience delays in their ability to recover their claims after any such insolvency or bankruptcy.

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It may be difficult to serve process on or enforce a U.S. judgment against us, our officers and our directors because we are a foreign corporation.

We are a corporation formed in the Republic of the Marshall Islands, and a substantial portion of our assets are located outside of the United States. As a result, you may have difficulty serving legal process within the United States upon us. You may also have difficulty enforcing, both in and outside the United States, judgments you may obtain in U.S. courts against us in any action, including actions based upon the civil liability provisions of U.S. federal or state securities laws. Furthermore, there is substantial doubt that the courts of the Republic of the Marshall Islands or of the non-U.S. jurisdictions in which our offices are located would enter judgments in original actions brought in those courts predicated on U.S. federal or state securities laws. As a result, it may be difficult or impossible for you to bring an original action against us or against these individuals in a Marshall Islands court in the event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise because the Marshall Islands courts would not have subject matter jurisdiction to entertain such a suit.

Seward & Kissel, our counsel as to Marshall Islands law, has advised us that the Marshall Islands does not have treaties with the United States and many other countries providing for the reciprocal recognition and enforcement of judgments of courts. However, there would be no impediment for you to originate an action in the Marshall Islands based upon Marshall Islands law.

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FORWARD-LOOKING STATEMENTS

Our disclosure and analysis in this prospectus pertaining to our operations, cash flows and financial position, including, in particular, the likelihood of our success in developing and expanding our business, include forward-looking statements. Statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” “projects,” “forecasts,” “may,” “should” and similar expressions are forward-looking statements.

All statements in this prospectus that are not statements of either historical or current facts are forward-looking statements. Forward-looking statements include, but are not limited to, such matters as:

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our future operating or financial results;

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global and regional economic and political conditions, including piracy, acts of terrorism or environmental disasters;

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our business strategy and expected capital spending or operating expenses, including drydocking, insurance costs, crew, number of off-hire days and any future vessel acquisitions;

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competition in the product tanker industry;

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statements about shipping market trends, including charter rates and factors affecting supply and demand;

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our financial condition and liquidity, including our ability to obtain financing in the future to fund capital expenditures, acquisitions and other general corporate activities;

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our ability to enter into fixed-rate charters after our current charters expire and our ability to earn income in the spot market; and

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our expectations of the availability of vessels to purchase in the future and the time it may take to construct new vessels, or vessels’ useful lives.

Many of these statements are based on our assumptions about factors that are beyond our ability to control or predict and are subject to risks and uncertainties that are described more fully under the “Risk Factors” section of this prospectus. Any of these factors or a combination of these factors could materially affect our future results of operations and the ultimate accuracy of the forward-looking statements. Factors that might cause future results to differ include, but are not limited to, the following:

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the cyclicality of the product tanker industry;

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charter values, counterparty risks and customer relations;

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changing political and governmental conditions affecting our industry and business;

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changes in economic and competitive conditions affecting our business, including market fluctuations in charter rates, charterers’ abilities to perform under existing time charters, and exchange rate fluctuations;

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applicable laws, regulations and taxes as well as changes in such laws and governmental regulations or actions taken by regulatory authorities;

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risks related to our recently formed company, its subsidiaries and our management;

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our fleet’s limited performance record, operating history and financial information;

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our liquidity, level of indebtedness, operating expenses, capital expenditures and financing;

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potential liability from future litigation and potential costs due to environmental damage and vessel collisions;

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partial dependence on spot charters;

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the length and number of off-hire periods and dependence on a third-party manager;

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the impact of electing to take advantage of certain exemptions applicable to emerging growth companies;

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risks related to war, terrorism and piracy; and

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other factors discussed under the “Risk Factors” section of this prospectus.

You should not place undue reliance on forward-looking statements contained in this prospectus, because they are statements about events that are not certain to occur as described or at all. All forward-looking statements in this prospectus are qualified in their entirety by the cautionary statements contained in this prospectus. These forward-looking statements are not guarantees of our future performance, and actual results and future developments may vary materially from those projected in the forward-looking statements.

Except to the extent required by applicable law or regulation, we undertake no obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events.

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USE OF PROCEEDS

We estimate that the net proceeds to us from the issuance of new common shares in this offering will be approximately $ million after deducting underwriting discounts and commissions and estimated expenses payable to us, or approximately $ million if the underwriters exercise in full their right to purchase additional shares, based on an assumed offering price of $ per share, which represents the midpoint of the price range set forth on the cover of this prospectus. A $1.00 increase (decrease) in the assumed public offering price would increase (decrease) the net proceeds to us from this offering by approximately $ million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and the estimated offering expenses payable by us.

We intend to use the net proceeds from this offering to fund approximately $ million of the purchase price for ten newbuild product tankers being built by a Korean shipyard, with any remaining proceeds being used for additional acquisition costs and general corporate purposes. The acquisition of the contracts for the newbuildings are subject to customary closing conditions. Delivery dates for the vessels range from September 2014 through January 2016. We currently expect to finance the remaining portion under future credit facilities and from our future cash flow from operations. Currently, we do not have any commitments to finance the debt portion of the purchase price. The actual amount of the equity portion and debt portion under our purchase obligations could be impacted by the availability of debt financing on favorable terms.

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OUR DIVIDEND POLICY

Diamond S Shipping III paid dividends of $19,000,000 in November 2012 and $9,000,000 in February 2013 to DS Shipping I, the immediate parent of Diamond S Shipping III and a wholly-owned subsidiary of DSS Holdings prior to the IPO Reorganization, to be used by DSS Holdings and its subsidiaries for working capital.

Subsequent to this offering, we do not anticipate declaring or paying any cash dividends to holders of our common shares in the near term. We currently intend to retain future earnings, if any, for use in the operation and expansion of our business. We may, however, adopt in the future a policy to make cash dividends. Our future dividend policy is subject to the discretion of our board of directors. However, any future payment of dividends may be restricted by the covenants contained in the MR Tanker Credit Facility. Any determination to pay or not pay cash dividends will also depend upon then-existing conditions, including our results of operations, financial condition, capital requirements, investment opportunities, statutory and contractual restrictions on our ability to pay dividends and other factors our board of directors may deem relevant. In addition, Marshall Islands law generally prohibits the payment of dividends other than from surplus (retained earnings and the excess of consideration received for the sale of shares above the par value of the shares), when a company is insolvent or if the payment of the dividend would render the company insolvent.

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CAPITALIZATION

The following table sets forth our cash and capitalization at December 31, 2013, as follows:

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on a historical basis for Diamond S Shipping III LLC and Diamond S Management LLC; and

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on an as adjusted basis, giving effect to the offering.

The adjustments that we have made for this offering include the issuance of common shares in this offering at an assumed offering price of $ per share, which represents the midpoint of the expected range set forth on the cover of this prospectus.

This table is derived from, and should be read in conjunction with, the audited and unaudited combined financial statements, related notes and other financial information included elsewhere in this prospectus. You should also read this table in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

		As of December 31, 2013
(U.S. dollars in thousands)		Actual(1)			As Adjusted(2)
Cash and cash equivalents	$	34,596		$
Debt:
Current portion of long-term debt	$	62,918		$
Long-term debt		534,978
Total debt		597,896
Shareholders’ equity:
Common shares with no par value, actual – 500,000,000 shares authorized, 33,333,335 shares issued and outstanding; as adjusted – 500,000,000 shares authorized, shares issued and outstanding		584,413
Accumulated other comprehensive loss		(7,081	)
Retained earnings		2,253
Additional paid-in capital		2,781
Total shareholders’ equity		582,366
Total capitalization	$	1,180,262		$

(1)

Assuming the IPO Reorganization had occurred as of December 31, 2013.

(2)

Assuming the IPO Reorganization and this offering had occurred as of December 31, 2013. Calculated based on an assumed public offering price of $ per share, after deducting underwriting discounts and commissions and our estimated expenses. A $ increase or decrease in the assumed public offering price per share would increase or decrease our total capitalization approximately $ million, assuming the number of shares offered in this offering remains the same as set forth on the front cover of this prospectus supplement.

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DILUTION

Dilution is the amount by which the offering price paid by the purchasers of our common shares in this offering will exceed the net tangible book value per common share after the offering. The net tangible book value is equal to the amount of our total tangible assets (total assets less intangible assets) less total liabilities. As adjusted to give effect to the IPO Reorganization, the pro forma net tangible book value as of December 31, 2013 would have been $519.7 million in total and $ per share.

As further adjusted to give effect to the sale of common shares in this offering, after giving effect to the completion of the conversion discussed in the immediately prior paragraph and after deducting underwriting discounts and estimated offering expenses, our pro forma net tangible book value as of would have been $ million, or $ per common share. This represents an immediate increase in net tangible book value of $ per share to the existing shareholder and an immediate dilution in net tangible book value of $ per share to new investors.

The following table illustrates the pro forma per share dilution and appreciation at December 31, 2013 (assuming the IPO Reorganization had occurred as of December 31, 2013):

	Initial public offering price per share			$
	Pro forma net tangible book value per share
	Increase in net tangible book value attributable to new investors in this offering
	Pro forma net tangible book value per share after giving effect to this offering			$
	Dilution per share to new investors

The following table summarizes, on a pro forma basis as at , giving effect to the IPO Reorganization and the sale of common shares in this offering, the differences between the number of common shares acquired from us, the total amount paid and the average price per share paid by the existing shareholders and the number of common shares acquired from us, the total amount paid and average price per share paid by you in this offering, based upon the initial public offering price of $ per share.

	Pro Forma Shares Outstanding				Total Consideration				Average Price Per Share
(U.S. dollars in thousands, except per share data)	Number	Percent			Amount	Percent			Average Price Per Share
Existing shareholders			%	$			%	$
New investors			%	$

Diamond S Shipping Group, Inc. S-1