Foreign owners decided on several hundred million kroner in dividends from companies that received crisis support from the Norwegian state during the pandemic.
NOK 9.5 billion was distributed by the Norwegian state in 2020 to companies applying for support due to the pandemic. The purpose of the cash benefit was to “avoid unnecessary bankruptcies and preserve Norwegian jobs”.
A survey E24 has done shows that companies that received support in 2020 and have foreign owners took several hundred million kroner in dividends in the first year of the pandemic:
- At least NOK 722 million in dividends went to foreign owners in 2020, from Norwegian companies that received support to get through the pandemic.
- The dividend abroad comes from 64 Norwegian companies, where foreign companies have the majority of the ownership. These Norwegian companies received a total of NOK 29 million in crisis support in 2020.
- All 64 companies that adopted dividends to foreign owners made a profit. All companies could repay the full amount of aid without ending up in the red.
E24 has previously revealed how much of the support money went to companies that improved their results during the pandemic. The companies that received support from the state took out more dividends in the pandemic year 2020 than in the normal year 2019.
The list of companies that have decided to send dividends abroad includes VN Leker, which sells the Peppa Gris toys, the lamp shop Flos and Groupe Seb Norway, which sells kitchen equipment from, among others, Tefal and OBH.
Sweden is the country where the most dividend kroner has ended up, ahead of Belgium and Denmark.
– Breaks with basic principles
– If anything, I think the figures illustrate that one should just be careful with the form of direct company support that has been given during the pandemic, says Karen Helene Ulltveit-Moe.
She is a professor of economics at the University of Oslo, and leads a research project on economic policy in times of crisis.
– These are support schemes that we have essentially not used since the 70s, nor in times of recession, and which violate basic principles for business policy, she says.
– We easily end up spending taxpayers’ money in an inappropriate way.
Ulltveit-Moe believes that the figures in E24’s survey reflect that it is difficult to provide direct support to companies in an accurate manner. She also points out that Norway must comply with international agreements, including the EEA agreement.
– Then we can not treat foreign companies differently than Norwegian, she says.
Took 130 million in dividends
Of the companies E24 has mapped, Allnex Norway is the company that took out the most dividends to its foreign owners. The company is based in Lillestrøm, and produces materials that are used in paints and varnishes.
Allnex Norway received NOK 700,000 in corona support from the state in 2020.
Last year, Allnex Norway had a turnover of just over NOK 650 million, which they also did in 2019. They are wholly owned by the international group Allnex with headquarters in Frankfurt, which has a turnover of over NOK 20 billion annually.
The board of Allnex Norway approved a dividend to its foreign owners of NOK 130 million for 2020.
– I have no comment on those articles, says general manager Roger Søråsdekkan to E24.
– I think the angle is wrong because during the covid crisis they had a set of rules for compensation, and a company like us chose to keep people in work. We spent more money on keeping people in work than we received in support, he says.
Clothing store for small sizes took great profits
The clothing store Brandy Melville approved a dividend for 2020 that was greater than the annual result.
The company is aimed at teenage girls, and is controversial because each garment is only available in one size – mainly “S” or “XS / S”.
The dividend was NOK 1.2 million, NOK 124,000 more than the 2020 result. In the same year, the company received more than NOK 179,000 in crisis assistance from the state.
Brandy Melville Oslo AS is wholly owned by the Swiss company Monterosso Ag. The Italian clothing brand has one store in Norway, in the popular shopping street Bogstadveien in Oslo, and has over 90 stores worldwide.
Brandy Melville was nominated for Save the Children Golden Barbie this year, which is awarded to the advertising or media actor who «makes young people feel the worst».
E24 has not succeeded in getting a comment from the board of Brandy Melville Oslo AS, or other representatives of the clothing brand.
Pays back the support
Lic Scadenta, a supplier of dental equipment, approved a dividend of NOK 40 million for 2020. The dividend went to the Swedish owner Dab Dental AB.
This same year, the Norwegian company received a quarter of a million kroner in corona support.
– Lic Scadenta has notified the Tax Administration of the refund of the pandemic support, writes general manager Arild Haugeland in an e-mail to E24.
He writes that the dividend comes not only from Lic Scadenta, but also their subsidiaries. These subsidiaries have also announced that they will repay the support they have received, Haugeland states.
60 million to Germany
Kaefer Energy AS received NOK 2.8 million in support from the Norwegian state in 2020. The company provides services to the petroleum industry, and has 1,700 employees in Norway according to the company’s website.
The board of the Norwegian company approved a dividend of NOK 60 million in 2020. The company is owned by German Kaefer International.
Communications manager Francisca Gorgodian in Kaefer, writes in an e-mail to E24 that 2020 was a very demanding year for the Kaefer Group and that the dividend was in line with the company’s usual dividend practice:
“These annual dividends are not only necessary to finance Kaefer Energy’s operations, but also other companies in the group. This is the advantage of belonging to an international group »
Kaefer International has also received dividends from another of its Norwegian companies – Kaefer Construction – which received NOK 848,000 in corona support and decided on a dividend of NOK 7 million.
This summer, E24 wrote that Louis Vuitton received NOK 893,000 in state aid in 2020 and would send NOK 40 million in dividends to the French owner. The brand is owned by French Bernhard Arnault, who according to Forbes was the world’s richest person in May 2021.
The case of the luxury brand sparked a new debate about cash subsidies and dividends. In August, the current Minister of Labor and Social Inclusion, Hadia Tajik, announced a full investigation into corona support – if the Labor Party came into government.
Dividend bans for companies that received support were discussed politically at the beginning of the pandemic. The desire from the left for a denial of dividends did not get a majority in the Storting when the scheme was adopted.
The most important argument against the ban on dividends has been that it would have been easy for companies to circumvent the ban by waiting to take dividends.