Norway’s $36bn domestic wealth fund has been opportunistic in buying up shares in John Fredriksen’s Frontline and Andreas Sohmen-Pao-backed Hafnia.
Folketrygdfondet, which runs the Government Pension Fund Norway, has upped its stake in Frontline to 5.3% and Hafnia to 6% as share prices dropped as investors sold off their shares.
The Frontline stake, which totals just under 12m shares, is worth more than $230m, while its position in Hafnia is roughly 31m shares worth about $161m.
The value of both positions had dropped from the first half of the year, the last time the government-backed, Nordic-focused investor bought rounds in both companies.
Then, its ownership of 4.8% of Frontline was worth $290m at the end of June, when its shares were trading at $25.76.
When it owned 4.4% of Hafnia, the shares were worth $230m, as shares closed the first six months of the year at $8.39.
Both companies maintain dual listings on the New York Stock Exchange and the Oslo Stock Exchange.
Shares of tanker companies have had a rough go of things of late, as the market has meandered through the typically weak summer only for sentiment to drop ahead of the stronger winter market.
In October, Clarksons Securities lowered its rate forecasts for 2025, while Fearnley Securities downgraded several product tanker companies, and DNB and Pareto Securities cut price targets for some tanker stocks.
Hope, though, could come from Opec unwinding production cuts and focusing on defending its market position, while tough-on-Iran policies from US President-elect Donald Trump could put more oil on mainstream tankers.
Folketrygdfondet has built up a multibillion-dollar portfolio of shipping and offshore companies, including Sohmen-Pao’s BW LPG and Fredriksen outfit Golden Ocean Group.
It also has a stake in DOF Group, backed by Fredriksen and fellow Norwegian shipping stalwarts Arne Blystad and Kristian Siem plus AP Moller-Maersk’s controlling shareholder, AP Moller Holding.
Earlier this year, TradeWinds reported that Frontline was among Folketrygdfondet’s top contributors in 2023.
Then, the fund’s chief executive, Kjetil Houg, said of its shipping investments: “In general, the upturn in the shipping sector has been driven by macro factors, which has provided a positive momentum.
“This has been a rewarding sector for us to be exposed to, and Frontline is listed on our top 10 list of single largest contributors to our equity portfolio in 2023.”
