– This only appears as an opportunistic sale that only comes because the price has gone up a lot. Director Eivind Veddeng at DNB Asset Management says it shows a lack of integrity and it’s very little.
On Thursday morning, energy company Vår Energi’s largest owner announced the completion of the sale of shares in the $1 billion class. 125 million shares were sold for a total of just over NOK 5 billion.
The sale comes just four months after Vår Energi went public, and the two principal owners entered into a so-called “closing agreement” with the brokerages, which includes DNB Markets and Sparebank 1 Markets.
Such an agreement would normally prevent Eni and Hitecvision from selling additional shares for six months after listing – unless they are granted an exemption. Something they got too.
This makes DNB Asset Management, the fourth largest owner of Vår Energi, look red.
– The facilitators obviously have the opportunity to grant waivers, so I don’t know if there was a breach of contract. But he says it’s a betrayal of trust, and I think it shows a lack of integrity towards us.
Sharp decline in the stock market
The share sale had an immediate impact on the share price of Vår Energi when the Oslo Stock Exchange opened on Thursday morning.
Sellers disposed of about five percent of all shares, increasing the free flow of the stock to about 16 percent. It also sold at a discount of more than twelve percent measured against Wednesday’s closing price.
Thus, our share of Energi fell directly on the exchange on Thursday, down more than eight percent.
In the prospectus since Vår Energi was listed on the stock exchange, it was clarified that facilitators, i.e. brokerages, can choose to exempt sellers from the closing agreement at their own discretion.
Veddeng of DNB Asset Management acknowledges that there is naturally language that facilitators could grant an exemption from such an agreement, but says he’s never seen anything similar before.
According to the fund manager, the value of DNB Asset Management’s holding in Vår Energi fell by about NOK 100 million, as a result of the price drop on Thursday.
In connection with the sale, it was announced that Eni and Hitecvision have now entered into new three-month lockout agreements. She does not trust Veddeng.
– It’s funny that they get a new lock right after they “break” the original. He says it’s not worth the paper it’s written on.
Alfred Berg also criticized
Nor was Leif Ericsrud in Alfred Berg particularly impressed with the behavior of brokerage houses. The asset manager is the fifth largest owner of Vår Energi after DNB Asset Management.
We’ve given clear feedback to the brokerages, they know where we stand, says Ericsrud, who doesn’t want to go further on how to conduct the dialogue with the brokerages.
He believes it is creating massive volatility in stocks with such heavy selling that should in fact have been prevented by closing, and believes it is “sabotage of our interests” by granting exemption from the closing agreement.
Ericsrud, like Wieding, thinks the new agreement is of little value.
– It really doesn’t make sense. He says it is of no value to us.
Criticisms were made to DNB Markets in this case, and it was asked for a rating in order to exempt Eni and Hitecvision from the original closing agreement.
In a text message, DNB communications consultant Vidar Dalsbo wrote:
“DNB Markets was one of the facilitators for the Vår Energi listing and yesterday’s sell-off. We have a dialogue with our customers about the deal and have no further comments at the moment.”
Sparebank 1 Markets did not respond to DN’s inquiries, neither regarding the closing agreement nor regarding criticism from managers.
On Thursday, DN was unsuccessful in contacting Hitecvision CEO – and co-founder of Vår Energi – Ole Ertvaag.
According to the exchange’s announcement on Thursday, the new closing agreement has “the same wording” as the agreement at the time of listing, and runs from June 13.
Not too surprising
DN has been in contact with Vår Energi, and investor contact Ida Marie Fjellheim says the company has yet to receive any response from co-shareholders Hitecvision and Enis.
Even if the shutdown is initially set to last until August, and so the market can expect the two big owners to be sitting with the shares until then, it probably isn’t surprising that this sale will come.
Fjellheim stresses that questions about the sale should be directed to the relevant shareholders.
Eni has made it clear repeatedly that the company will be the largest owner of Vår Energi, but it should come as no surprise that there will be a small adjustment in the ownership stake, she adds.
Our Energi stock is trading on Thursday afternoon for about NOK 42.1, for NOK 40.2 that was the share price on the Eni and Hitecvision sale. On Wednesday, Vår Energi’s stock closed at NOK 45.87, meaning the sale took place at a 12.4 percent discount.
– The extraordinary development in the share price has given us an opportunity to put more shares on the market, which will enhance the liquidity of the share, said Enis Chief Financial Officer Francesco Gattei in a press release Thursday morning.
After the deal, Eni owns about 63.1 percent of the shares in Vår Energi, while Hitecvision is left with an ownership stake of about 20.7 percent.(Conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using a link that leads directly to our pages. All or part of the Content may not be copied or otherwise used with written permission or as permitted by law. For additional terms look here.
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