Pension fund dumps its sharesin Røkke's Aker Solutions

Norway’s state pension fund has sold off all its shares in Aker Solutions, reported newspaper Aftenposten over the weekend. Pension fund officials won’t say why, but the sale is being viewed as a form of protest over the way Aker Solutions’ controlling shareholder Kjell Inge Røkke is running things. It may also be a protest against the government, which gave in to Røkke last month.

“It’s a clear signal when a major shareholder sells itself out,” Torger Reve, a professor and former dean of Norwegian business school BI told Aftenposten . “And this isn’t just any shareholder.”

Reve noted there are two types of shareholders: “One votes with his feet when he disagrees (with management),” he said. “The other goes to the shareholders’ meeting.” In this case, it appears the pension fund is voting with its feet, and thereby also defying state government officials who gave in to Røkke after he orchestrated controversial deals involving Aker Solutions this spring.

It’s possible the pension fund’s stake in Aker Solutions no longer fits the portfolio, Reve added. But he views the sale as a form of protest.

The pension fund (Folketrygdfondet) has a history of quarreling with Røkke over the way he treats minority shareholders. Former fund director Tore Lindholt was known to publicly challenge Røkke. New fund managers have instead simply sold off the 2.1 million Aker Solutions shares the fund had at the end of March. It’s not immediately clear how much of a gain or loss the fund realized on the sale.

The timing of the sale is also curious, coming just before a corporate assembly aimed at easing the conflict that exploded around Easter, when representatives of the Norwegian government (which made a separate, controversial major investment in Røkke’s Aker empire two years ago) felt they had been cheated when Røkke orchestrated deals that analysts claim can enrich him at the expense of Aker Solutions.Pension fund officials, meanwhile, are mum. “We don’t comment on changes in the portfolio,” deputy director Lars Tronsgaard told Aftenposten . “And we never comment on why we buy or sell shares.”

When confronted with the view that the sale is a protest against Aker Solutions’ management, Tronsgaard said “that will have to stand for your own account.”

Opposition politicians, meanwhile, applauded the pension fund’s sale and were in little doubt that it was a protest against Røkke.

“It’s interesting that (the state pension fund) chose to desert a company that the government, for political reasons, has chosen to actively invest in,” said Lars Sponheim of the Liberal Party (Venstre) .

Sponheim claims the government’s initial investment of taxpayer money in Røkke’s Aker Holdings has led to “the biggest political scandal in this government period.”

The Conservatives claimed the government can’t ignore the pension fund’s decision to dump the Aker Solutions stock. “This is a very clear sign of disagreement over the economic effects of the Aker transactions,” said the party’s spokesman on business matters, Torbjørn Hansen.