Prime Minister Jonas Gahr Støre and Agriculture Minister Sandra Borch could say on Wednesday that the giant property in Trøndelag would end up in the hands of the state. State-owned Statskog SF paid NOK 2.65 billion for 1.2 million acres, of which 200,000 acres are forest that can be cut to make money. But the price raises eyebrows in the industry. Finansavisen writes on Friday that billionaire Bjørn Rune Gjelsten got away with paying well under half the price per meter when he secured Værdalsbruget last year for between 800 and 900 million. news can now tell how one of the most expensive property deals of all time came to fruition. Closed auction process Several sources inform news that the sellers invited to a closed bidding process. It is a form of auction without continuous bidding, but where interested parties can usually only submit one bid in the hope that the price will be the highest. The state therefore had to put a sum on the table without knowing what other bidders were willing to offer. news has asked chairman and board member Richard Arnesen of the selling foundations about how the sale took place. – I am initially not willing to disclose that, but we went out widely to a number of buyers at home and abroad. Danske Bank was our adviser, he says. Richard Arnesen (right) represents the sellers. The sellers of Meraker Brug are Astrup Fearnley Holding AS, Kulsrud Skog AS and Stiftelsen Thomas Fearnley, Heddy and Nils Astrup. Photo: Ole Martin Wold / NTB – The reason I ask is that news has information from several sources that this was a form of closed bidding process, where the bidder was not given access to other bids. – That is correct, he confirms. – Why did you choose this form of bidding process? – No, I don’t think I have any comments on that. That was the advice we received, he says. The Støre government has become the happy owner of the plot of land in Trøndelag with forestry, hunting and fishing and property development. Meråker Brug has several fall rights, and also owns half of the Meråker alpine center, several farmyards and a number of cabins that are rented out for hunting and fishing. Photo: Meråker Brug Broker believes the mill is worth 1.5 billion The experienced and former agricultural broker Ketil Koppang estimates that he has sold between 1300-1400 properties, and has never experienced closed bidding. He assumed the property was worth NOK 1.5 billion, and believes the government paid a “Donald Duck price” based on the return on the property. – It is easy to assume that they have paid an exceptionally high price. It is not that difficult when you send the tax bill to the people. The price is productive forest, and here there are nowhere near 1.2 million acres of productive forest, he says to news. Ketil Koppang sold the brokerage business two years ago to Landkreditt. In his career as a broker, he became one of the country’s most experienced agricultural brokers. Photo: Koppang Landbruk – How can a closed bidding round affect what bidders are willing to bid? – It is clear that you are going to be at the top if you want it for life or death, he says. Meråker Brug AS has a plot of land that extends over 1.2 million acres. Photo: Vegard Woll / news Arnesen will not say anything more about the choice of process. – As sellers, we wanted a good process, a good price and a good agreement. We have got that, says Arnesen. Koppang believes the state may have gone “extremely high” in the closed bidding round to make sure that foreign owners did not reach the highest bid. – There can be nothing other than protectionist thinking behind it, but I congratulate the seller on a fantastically good price, he says. – Reasonable price in a long-term perspective Both Statskog and the government have calculated the value of the property before the purchase. Managing director of Statskog, Gunnar Lien, disagrees that the price was too high. – We can have different opinions about what the value is. We have made our estimates according to what has been set. Forest is one of the elements. It is clear that if the property was only productive forest, the value would be significantly lower, he says to news. He points out that there are also several values with, among other things, two power plants and hunting and fishing rights. Statskog has been responsible for the value calculation, and asked the Ministry of Agriculture and Food for authorization for the purchase. – We have offered what we believe is a reasonable price in a long-term perspective, says Lien to the criticism. Gunnar Lien is managing director of Statskog, which is owned by the state. Photo: Espen Sandmo / news Was contacted in May by the seller Danske Bank gave a statement on behalf of the sellers at the end of May, according to Lien. They wondered whether the state-owned company might be interested in buying Meråker. – We confirmed that it was natural for us to look at it. We follow other properties that appear. So it is that Statskog does not have the authority to buy this on its own, and it must be approved by our owner and also the Storting. For us it was natural to inform the Ministry of Agriculture and Food about it, says Lien. He will not comment on how the bidding process went, and refers to the seller. – How did you come to the conclusion that the price was right? – With the assistance of our advisers, we have made an assessment of the property and its potential from a business point of view, where we have assessed the value of the forest, hunting and fishing, the property development potential, and look at future options. We have tried to put a number on it. It is a complex exercise. Several actors will have different views, says Lien. The government hired Pareto to calculate The ministry paid financial advisers in Pareto to value Meråker Brug and put a cap on the bid in the mandate, according to the proposition presented on Friday. The financial advisers in Pareto wrote to the ministry: “The price Statskog SF has agreed to pay for the shares is within the range we believe other bidders would be able to value the shares at.” The Ministry of Agriculture and Food therefore authorized Statskog to purchase the property. – They confirmed that the offer was within reason before the offer was made. Both we and our owners have made an assessment there, says Lien. The ministry tells news that political leadership has not been involved in the bidding process surrounding the purchase, and that they will therefore not answer questions about the price. The state gives money and loans to Statskog to pay for the property.
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