Hugo Maurstad lost 33m on XXL – keeps buying

Having served as chairman of the board of listed sports chain XXL since 2019, Hugo Morstad left the board just over a month ago and was replaced by Synsam CEO Håkon Lundstedt.

– I have three large production companies in the field of sports; Odlo, Henri-Lloyd and Janus, said Maorstad after his departure, and it’s important for me to be able to use more resources on these.

Morstad took over as chairman of XXL after his previous employer, acquisition firm Altor, became a major owner. Altor currently owns just under a third of the shares in the company.

In addition to being Chairman of the Board, Morstad has been one of the largest investors in XXL for a number of years through the holding company Funkybiz. And despite the fact that Morstad and XXL have now chosen to separate, Morstad has continued to put more weight in the company.

Believe in the concept

Like a number of other “brick and mortar” store chains, XXL has struggled to adjust to the transition to online shopping. In the aftermath of the Covid pandemic, the current problems of high capital, stock constraints, poor liquidity and very expensive investments in the Austrian market are becoming more pressing.

The company was mercilessly punished on the stock exchange, and at the end of 2022 the story took an interesting turn when it turned out that the fund manager DNB Asset Management had shorted 1.3 million shares in the company. Investors in XXL have suffered huge losses in the papers. The sports chain is down nearly 70 percent in the past year, and has a market capitalization of just under NOK 850 million.

However, this does not appear to have dampened Morstad’s appetite for investment. From the Shareholders’ Holding Service, it appears that last week Moorstad bought more than half a million shares in XXL at an average price of two kroner. In total, Morstad owns 5.8 million shares in the company and, according to DN’s calculations, has totaled more than NOK 33 million in paper losses since entering in 2020.

– Although I no longer have a role in XXL, I believe in the new concept and management. So, I increased my exposure somewhat, Morstad says in a text message.

Shortly after buying the shares, the company announced that the Norwegian tax agency believed that XXL had underestimated its taxable income, and that the company owed 139 million in taxes. Trading in the stock temporarily stopped and the stock exchange results were great at times, and the stock fell by a meager 7 percent.

Aside from the position at XXL, Morstad’s Funkeepies has a larger position in the SATS fitness center chain, with a 2.5 percent stake, as well as exposure to media giant Cheepstead. (conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We’d like you to share our statuses using links that lead directly to our pages. Reproduction or other use of all or part of the Content may be made only with written permission or as permitted by law. For more terms see here.