FL-Group buys 26 per cent of Straumur-Burdarás Skip to content

FL-Group buys 26 per cent of Straumur-Burdarás

A battle for control of investment bank Straumur-Burdarás appears to have been resolved. As widely reported in the Icelandic media, two dissident directors, Magnús Kristinsson and Kristinn Björnsson, have sold their shares to FL-Group in exchange for shares in FL-Group and Kaupthing (KB-bank).

According to Vidskiptabladid, FL-Group will issue ISK 1.8 billion new shares (nominal value) in connection with the transaction which represents 29 per cent of the outstanding share capital of the company. A shareholder meeting will be held at FL-Group on July 7.

Vidskiptabladid values the transaction at ISK 47 billion, ISK 35 billion of shares in FL-Group priced at 18.52 króna per share and ISK 12 billion of shares in Kaupthing priced at ISK 748 per share. After the transaction, FL-Group will hold a stake of 26 per cent in Straumur-Burdarás.

Landsbanki, together with subsidiaries and other affiliated companies, is the largest shareholder of Straumur-Burdarás, with 37 per cent. It is also the 2nd largest shareholder of FL-Group with 17 per cent.

Magnús, a fisheries mogul based in the Vestmann Islands, and Kristinn, the former CEO of Skeljungur, the Icelandic distributor for Shell Petroleum, had called for an extraordinary shareholder meeting at Straumur-Burdarás to elect a new board of directors.

Their adversary was Straumur-Burdarás chairman Björgólfur Thor Bjórgólfsson, son of Landsbanki chairman Björgólfur Gudmundsson. According to the UK daily Guardian, the two Björgólfs made their money in the brewing business in St. Petersburg, Russia, in the 1990’s “in the city regarded as the Russian mafia capital … in the drinks sector, seen by the mafia as the industry of choice.” The two Bjorgolfs, together with their business partner Magnus Thorsteinsson, acquired a controlling stake in the former state-owned bank Landsbanki in a controversial privatization in 2002.

FL-Group CEO is the US-trained MBA, ex-McKinsey consultant and former Chief Business Officer of deCode Genetics, Hannes Smárason. Last year 6 of 7 board members of FL-Group resigned during Hannes’s tenure as chairman of FL-Group amid allegations of unauthorized transfers of ISK 3 billion from the company’s accounts.

Serving on the FL-Group’s board of directors since last year is Jón Ásgeir Jóhannesson, CEO of Baugur. He is currently being prosecuted for various alleged violations of the criminal and company code.

Sign up for our weekly newsletter

Get news from Iceland, photos, and in-depth stories delivered to your inbox every week!

* indicates required

Subscribe to Iceland Review

In-depth stories and high-quality photography showcasing life in Iceland!

Share article


Recommended Posts