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Monday, June 24, 2024

Family feuds over business sale

Frederik Wilhelm Mohn took to the Norwegian media on Monday to rage against his father, billionaire businessman Trond Mohn, after he secretly sold the Bergen-based family company Frank Mohn AS for NOK 13 billion (USD 2.2 billion). Swedish industrial engineering company Alfa Laval bought the pump manufacturer, but Frederik argued he should’ve had the first right to buy the business through his own investment company.

Frederik Wilhelm Mohn, right, pictured on the family firm's website with his father, philanthropist Trond Mohn, the wealthiest man in western Norway. PHOTO: Frank Mohn AS
Trond Mohn, left, and Frederik Wilhelm Mohn, pictured on the family firm’s website in happier times. Frederik accused his father of secretly selling off the family business, and argued he had the first purchase rights. Frederik’s wholly-owned investment company is investigating if it can block the NOK 13 billion sale. PHOTO: Frank Mohn AS

“This is a disgrace!” wrote Frederik in a text message to newspaper Bergens Tidende (BT) on Sunday. “I found out yesterday about the sale by Trond Mohn and I thought it was a cowardly negotiation action from my father. I apologize to all the staff, but especially the unions. Trond Mohn never managed to carry out the generational change in the business which his father, Frank Mohn founded. It became too difficult to admit that he had a clever son. We have not yet been contacted by Alfa Laval, and that says the most about Trond Mohn’s procedures. Shame on you Trond!”

Newpaper Dagens Næringsliv (DN) reported Frederik had been the managing director in Frank Mohn before he suddenly resigned in December 2012, citing different views on the company’s future strategy. It happened a short time after Frederik was investigated by the economic crime unit, Økokrim, over shareholdings in his majority-owned company Songa Offshore. The matter was dismissed. “He has gone behind my back,” Frederik said. “The process has been going on since last summer. He has the gift of cowardice.”

Considering alternatives
Frederik said his his wholly-owned investment company Perestroika was considering strategies and financial alternatives to Alfa Laval’s bid. “Perestroika notes that the right of first refusal to Perestroika by the transfer of shares in the group is not revoked prior to the bid,” said the company in a release. “Perestroika will consider all alternatives, including legal action to stop the bid.”

At a press conference on Monday afternoon, Trond said it was not true that his son had the right of first refusal, and it was sad that he opposed the sale. “It seems we are sorry,” Trond said. “Beyond that, I hope you can understand that it stops there.”

He said the company was contacted about the sale last autumn, and decided the timing was right given the business is in a positive period. “But the offshore business is very cyclical, it can be that we would have got a better price if we waited a year or two, we don’t know,” Trond continued. “It also has to do with my own age.” He wouldn’t say exactly what the proceeds would be spent on, but said it was no secret he had a good eye for research, sport and the youth movement.

Finance analyst Frederik Lunde at research firm Carnegie told DN Trond got a fantastic price for the enterprise, while Alfa Laval Chief Executive Lars Renström said it was “well considered.”

Still a Bergen business
Frank Mohn was set up by Trond’s father in the 30s. It has 1,200 employees, and had a turnover of NOK 3.4 billion last year. Frederik owns 32.2 percent of Frank Mohn AS/Wimoh AS through Perestroika. Framo Developments owns 47.8 percent and Trond’s sister Marit owns 20 percent. Through his company Meteva AS, Trond owns 77.33 percent of Framo Developments and Frederik owns 2.67 percent through Perestroika.

Trond said the decision to sell needed 66.67 percent support, which was enough from his and Marit’s stakes. “I think Frederik is a clever investor and wish him luck with that,” said Trond, and added that his own father Frank would be proud of the sale.

He said it was a little sad to sell the family business, but it was also going to be much more fun to pay out the money while he was still alive. “International ownership is becoming more and more prevalent,” he explained. “So long as we have our resources here in Bergen with the same people, the same wealth of ideas and the same work effort, ownership is secondary.” Woodgate



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