As filed with the U.S. Securities and Exchange Commission on March 6, 2014

Registration No. 333-193747

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

AMENDMENT NO. 3
TO

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  ☐

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price(2)(3)		Amount of Registration Fee(4)
Common Shares, no par value(1)	$	257,600,000	$	33,178.88

(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.

(4)

• The registration fee was previously paid.

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.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to Completion dated March 6, 2014

PRELIMINARY PROSPECTUS

14,000,000 Shares

 

DIAMOND S SHIPPING GROUP, INC.

Common Shares

We are offering 14,000,000 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 $14.00 and $16.00 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.

	Per Common Share	Total
Public offering price	$	$
Underwriting discount(1)	$	$
Proceeds to the Company before expenses	$	$

(1)

• The underwriters will receive compensation in addition to the underwriting discount. See “Underwriting.”

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 2,100,000 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

DNB Markets HSBC SEB

Global Hunter Securities Fearnley Securities Stifel

Prospectus dated           , 2014.

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.

TABLE OF CONTENTS

PROSPECTUS SUMMARY	1
RISK FACTORS	14
FORWARD-LOOKING STATEMENTS	35
USE OF PROCEEDS	36
OUR DIVIDEND POLICY	37
CAPITALIZATION	38
DILUTION	39
SELECTED HISTORICAL FINANCIAL AND OTHER DATA	40
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	43
THE PRODUCT TANKER INDUSTRY	68
BUSINESS	89
MANAGEMENT	107
EXECUTIVE COMPENSATION	113
PRINCIPAL SHAREHOLDERS	116
RELATED PARTY TRANSACTIONS	118
SHARES ELIGIBLE FOR FUTURE SALE	120
DESCRIPTION OF OUR CAPITAL STOCK	122
DESCRIPTION OF INDEBTEDNESS	125
MARSHALL ISLANDS COMPANY CONSIDERATIONS	127
TAX CONSIDERATIONS	129
UNDERWRITING	135
LEGAL MATTERS	141
EXPERTS	141
WHERE YOU CAN FIND ADDITIONAL INFORMATION	141
ENFORCEABILITY OF CIVIL LIABILITIES	142
GLOSSARY OF SHIPPING TERMS	143
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 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 current 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 investment funds managed byCarVal Investors, LLC, or CarVal, an independently managed subsidiary of Cargill, Incorporated. We plan to further expand our fleet, in part from the proceeds of this offering, through the purchase of ten newbuild product tankers from a Korean shipyard. These vessels, which we refer to as our expansion fleet, have contractual delivery dates between September 2014 and December 2015. We intend to continue making modifications to our current 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 current fleet is 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 independently managed subsidiary 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.

■

• 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.

■

• 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.

■

• 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.

■

• 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.

■

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

■

• 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.

■

• 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 Expansion Fleet

Following the completion of this offering, we intend to purchase ten newbuild product tankers from SPP, a Korean shipyard. These vessels have contractual delivery dates between September 2014 and December 2015. Upon delivery, we intend to employ these vessels on time charters or in the spot market, including in spot market-related vessel pools, based on market conditions.

Vessel Hull No.	Contractual Delivery Date	Capacity (DWT)		Yard
S5130	September 2014		50,300		SPP
S5131	November 2014		50,300		SPP
S5132	February 2015		50,300		SPP
S5133	April 2015		50,300		SPP
S5134	June 2015		50,300		SPP
S5135	August 2015		50,300		SPP
S1177	September 2015		50,300		SPP
S1178	November 2015		50,300		SPP
S1183	December 2015		50,300		SPP
S1184	December 2015		50,300		SPP
Total: 10 Vessels			503,000

The following table summarizes the percentage of contracted revenue days to total revenue days for our current 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 Current Fleet” and “Business—Our Customers” for additional information about the vessels in our current 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.

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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, as of the beginning of fiscal year 2014, 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, including the ones in our expansion fleet, in similar ways to benefit from improving rate environments while maintaining a base of stable cash flows.

Large, modern, high-quality fleet.   According to Fearnleys, 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 have contractual delivery dates between September 2014 and December 2015. 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.

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 have contractual delivery dates between September 2014 and December 2015.

Optimize the operating efficiency of our 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

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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 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. In addition, we intend to consider opportunities to participate in vessel pools with reputable operators of spot tonnage, seeking to create industry-leading operators which we believe will allow us to commercially consolidate the industry. 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.

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 and assuming no exercise of the underwriters’ option to purchase additional shares, WL Ross will own approximately 22.7%, First Reserve will own approximately 19.1% and CarVal will own approximately 12.9% of us. Please see “Principal Shareholders” for a more detailed description of our share ownership following this offering.

6

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, including upon acquisition of the newbuilds.

 

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.

7

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:

■

• the cyclicality of the tanker industry;

■

• charter values, counterparty risks and customer relations;

■

• changing political and governmental conditions affecting our industry and business;

■

• 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;

■

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

■

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

■

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

■

• risks related to our growth strategy, including the delivery and deployment of our ten newbuild product tankers;

■

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

■

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

■

• partial dependence on spot market rates, including earnings from any spot market-related vessel pools we may join;

■

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

■

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

■

• 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,

■

• 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.

8

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.

Revolving Credit Facility

On February 21, 2014, DSS Vessel III LLC, our wholly-owned subsidiary, entered into a credit facility (the “Revolving Credit Facility”) that provides for up to $35 million in revolving loans and permits us, with the consent of the agent bank, to request up to an additional $40 million for an aggregate of $75 million in revolving loans upon the consummation of this offering. The Revolving Credit Facility bears interest at a variable rate equal to LIBOR plus an applicable margin of 2.90%, and is secured by two of our MR product tankers. The Revolving Credit Facility matures on February 21, 2017. We intend to use borrowings under the Revolving Credit Facility for working capital purposes.

The Expansion Fleet

Following the completion of this offering, we intend to purchase ten newbuild product tankers from SPP, a Korean shipyard, for approximately $380.0 million. These vessels have contractual delivery dates between September 2014 and December 2015. Upon delivery, we intend to employ these vessels on time charters or in the spot market, including in spot market-related vessel pools, based on market conditions. We expect to finance up to $190.0 million of the purchase price through the proceeds from this offering and approximately $190.0 million from borrowings under future credit facilities, less any amount we may choose to apply from our future cash flow from operations. Currently, we do not have any commitments to finance the debt portion of the purchase price. For additional information on the risks related to our uncommitted financingfor our expansion fleet, see “Risk Factor—We do not currently have debt or otherfinancing committed to fund a significant portion of our expansion fleet.”

9

The Offering

Common shares presently outstanding(1)

33,333,335 common shares

Common shares to be offered

14,000,000 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 2,100,000 common shares.

Common shares to be outstanding immediately after this offering

—assuming no exercise of option to purchase additional shares

47,333,335 common shares

—assuming full exercise of option to purchase additional shares

49,433,335 common shares

Use of proceeds

We estimate that the net proceeds to us from the issuance of new common shares in this offering will be approximately $193.1 million after deducting underwriting discounts and commissions and estimated expenses payable by us, or approximately $222.7 million if the underwriters exercise in full their right to purchase additional shares, based on an assumed offering price of $15.00 per share, which represents the midpoint of the price range set forth on the cover of this prospectus.

We intend to use the net proceeds from this offering to fund up to $190.0 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. Contractual delivery dates for the vessels range from September 2014 through December 2015. We currently expect to finance approximately $190.0 million under future credit facilities, less any amount we may choose to apply 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.

(1)

• Gives effect to the IPO Reorganization.

10

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 Per Share(2)
Basic							$	0.32					$	0.07
Diluted							$	0.32					$	0.07
Pro Forma Weighted Average Shares Outstanding
Basic								34,121,838						34,121,838
Diluted								34,121,838						34,121,838

11

	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
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