Gresvig

"In Gresvig, however, Røkke and Gjelsten were not interested in extracting the gold any longer. It was much more interesting to sell the gold mine onwards. With Austad in the boss’s chair, the company had turned around and was doing well, now a sale was on the horizon. The job went to Dag Fasmer Wittusen and his team. They listed Gresvig on the stock exchange and put out a small share offering for public sale. "All of Norway" wanted to buy into Kjell Inge Røkke's successful company. Shares for 90 million kroner were released in the first round, and they were sold out 17 times!"

"Austad is an inspirer and a brand builder by the grace of God. Where others got hung up on zippers and buttons on the sports jackets, Austad noticed the brand on the chest. What were the customers really asking for when they bought Nike shoes for 1,300 kroner? Was it the quality of the shoe, or was it the status of owning such an expensive shoe, combined with the buyer believing the shoe was extremely good? Austad understood how the customers thought, and where sports stores nagged about screws, nuts, and service, the boss thought sales, sales, sales. Austad himself emphasizes that he should not take all the credit. Smart enough, he always stressed how important and useful it was to have Kjell Inge Røkke and Bjørn Rune Gjelsten on the board. "Most other boards spend 90 percent of the time talking about the past, and only 10 percent about the future. In the Gresvig board, it was the opposite. There we mostly looked forward," says Austad. Before the trio took over, G-Sport was a series of country stores with huge parts warehouses and outdated tracksuits. Many of the stores struggled heavily, with little support from the chain. Austad backed them into a corner: Either they joined, or they were out immediately."

"The Gresvig coup also had other typical Røkke traits. It was here he first discovered how useful it is to sit on all sides of the table. The first thing Røkke and Gjelsten did was to pump goods from their own companies through Gresvig. The G-Sport stores were filled with clothing items from Frank Shorter and Tomra – "on business terms," as it was stated. At the same time, they bought Gresvig's buildings and leased them back to Gresvig. Through many cunning maneuvers, the rest of the Røkke system extracted 40–50 million kroner a year. On top of that, Røkke and Gjelsten's company, Sport Invest Inc., demanded "consultancy fees" to assist the Gresvig management. No less than 13 million kroner were taken out in one year. To top it all off, the new owners were not modest enough to refrain from draining Gresvig of 36 million kroner in group contributions."

"For Johnny Austad, Gresvig was a saga that made him a multimillionaire. When he turned 40, he bought himself a Harley Davidson motorcycle, and he made the roads in Inner Østfold unsafe. But only for a short while, because soon after, he was paralyzed in half of his face. The muscles in his face couldn't handle the wind, so he had to stop riding motorcycles. Instead, it was back to business, as they were now looking for more brands, and Austad had no doubt when he spoke with Gjelsten and Røkke: As a customer, he had experienced the Mosse-company Helly Hansen up close, and there was much that could be improved. "If you are going to buy a new brand, it must be Helly Hansen," said Austad. In Austad's eyes, Helly Hansen did everything wrong. Instead of making what customers wanted, they made products that suited production. They held a world-leading brand, but only had products for bad weather – a type of weather that almost only existed north of the Arctic Circle. Orkla CEO Jens P. Heyerdahl had also noticed the pupil's good handling with Gresvig. It was Orkla that owned Helly Hansen, and Heyerdahl knew all too well that they had never managed to get things running smoothly. Helly Hansen was one of the last textile factories to move production from Norway to Portugal, and when the rest moved on to the East, Helly Hansen was left with a large Portuguese factory. Something was fundamentally wrong, the Orkla CEO understood."

"The meeting began with Austad presenting the company and his thoughts about the future. Then they went out and walked around the buildings on the fields east of Askim. There, Austad was pulled aside by Gjelsten's partner and asked a short question: "Do you believe in this?" When Austad answered yes, the decision was made. From then on, both Gjelsten and the unknown partner, who of course was Kjell Inge Røkke, talked as if they were going to buy Gresvig."

"How could Røkke replace the boss at Helly Hansen? "It wasn't that difficult. There was just one man who needed to talk to two people," says someone closely connected. The outcome was that RGI bought half of Helly Hansen for 125 million, and at the same time made a transfer agreement between the directors. For an appropriate severance pay in the million class, they agreed to switch jobs. Thus, the systematic Gyrd Skråning went to Askim, while Johnny Austad took over Helly Hansen in Moss. And when RGI shortly thereafter completely sold out of Gresvig, Gyrd Skråning disappeared off the sidelines for RGI's part."

"Now, the days of a thousand different pairs of skis were over. The number of models was to be radically reduced. Now there were few and inexpensive goods, combined with fierce marketing campaigns. As soon as Easter was over, it was bike season and massive marketing through television and newspaper ads. In a few weeks, Gresvig sold 15,000 bikes – just as Austad had predicted. The warehouses disappeared and the money started flowing in the right direction. In 1992, Gresvig had a profit of 22 million, the following year 24 million. But then the pieces fell into place: 1994 ended with an incredible 66 million in profit. So far, no one had any reason to complain – least of all the stores. Although it was more expensive to be part of the chain, and they were forced into purchasing loyalty, the stores were doing better than ever. And at Gresvig's central warehouse in Askim, work was going full speed. None of the 130 employees feared for their jobs. "They have twice as much to do, and they’re having twice as much fun," said the boss."

"The lightning attack on Intersport in the fall of 1993 is a classic Røkke operation. With a store sale of over 650 million kroner, Intersport was the major competitor to Røkke's sports chain, Gresvig. At the same time, many of Intersport's stores were faltering, and the chain was struggling financially. The chain was, in short, a tempting target, and Gresvig sat like a vulture waiting for the right moment to strike. In this situation, Kjell Inge Røkke makes two ruthless moves; he contacts Intersport’s CEO, Erik Myhren, and offers him an enticing financial proposal. At the same time, he tempts Intersport’s most important member, sports store owner Tommy Bøhmer, to switch over to Gresvig with his seven very profitable stores in Oslo. Intersport's board is completely unaware of the brutal attack. It happens quickly, decisively, and in complete secrecy. The next thing that happens is that Tommy Bøhmer accepts the offer. Then, Intersport director Erik Myhrer sends a letter to all the stores in the Intersport chain advising them to switch over to Gresvig. The director's game behind the backs of his own owners explodes like a bomb in Intersport's board. Røkke has managed to create unrest in the ranks, and now he is making his next move: He offers all store owners 100,000 kroner in transfer sums. At the same time, he promises to lift them out of a significant debt of 57 million kroner that everyone is responsible for at the chain's headquarters. Touché!"