On Monday, Aker ASA—the 180-year-old shipping, fishing, energy and manufacturing multinational that is Norway’s 11th largest company by revenue (and 5th largest by market capitalization)—announced that it is launching a new Bitcoin subsidiary. The new firm, Seetee—a nod to the phrase “contraterrene,” or anti-matter, (abbreviated CT)—will be seeded with half a billion Norwegian fiat kroner, making Aker ASA the first major Scandinavian country to allocate to Bitcoin
According to Aker ASA Kjell Inge Røkke said the venture’s initial capitalization is expected to “increase significantly over time” as Seetee gains experience and identifies new opportunities. Seetee itself is being established under a holding company that is 90.1 percent owned by Aker Capital.
In a 23-page letter to shareholders on Monday, Røkke—Norway’s fifth-richest man and a charismatic media figure—set forth his company’s rationale for allocating to cryptocurrency, which he says is based on a three-part strategy.
True passion!
First, he said, Bitcoin has been designated Seetee’s treasury asset, making the company a holder (or, in crypto parlance, a “hodler”) as opposed to an active trader of cryptocurrency.
Second, Seetee will engage in mining operations to transfer stranded or intermittent electricity without stable demand locally—e.g. wind, solar, and hydro power— to economic assets that can be used anywhere. Røkke said his firm sees Bitcoin functioning like “a load-balancing economic battery,” batteries being “essential to the energy transition required to reach the targets of the Paris Agreement.”
Finally, Røkke wrote, Seetee will build and invest in projects and companies across Bitcoin’s ecosystem. “This is where our true passion is!” he declared.
Seetee has already launched a collaboration agreement with Bitcoin and blockchain infrastructure firm Blockstream, with an initially focus on mining operations, but later building on Blockstream’s unique strengths in blockchain technology and Aker’s industrial legacy and capability set.
“Bitcoin may still go to zero,” Røkke acknowledged in Monday’s shareholder letter. “But it can also become the core of a new monetary architecture. If so, one bitcoin may be worth millions of dollars. The asymmetry is interesting to a portfolio. People who know the most about bitcoin believe its future success is nearly inevitable. Whereas the other camp thinks that its failure is equally certain. Status quo is not possible.”
In any case, the sensationalistic Bitcoin venture could be a valuable (and necessary) hedge for Aker ASA. The company, whose exposures to offshore oil and shipping left it hard hit by the initial wave of covid-19, lost 52 percent of its equity value in the first three months of 2020. Its fiscal fourth quarter and full year 2020 report, released late last month, showed the company’s net asset value ended the year at $53.4 billion (about $6.3 billion), up 75 percent from the previous quarter and the largest quarterly increase ever recorded in the company’s history. Upon that release, Aker ASA President and CEO Øyvind Eriksen attributed the rapid recovery to its flexibility.
“As proven in the last few months, the ability to continuously adapt is in Aker’s DNA,” Eriksen said, adding that Aker ASA had made a “step change” in its portfolio, rapidly diversifying and staking positions in renewable energy, green technology and “increasingly allocating more resources and capital to digitalization and industrial software.”
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