SeaDrill

"Essentially, Fredriksen and Trøim agreed on the recommendations from their most important brokerage connection. The race was on, and Pareto would hold their hands throughout. In May, just three months later, the investor market was introduced to SeaDrill, Fredriksen's new major venture. In addition to three worn drill rigs, the company comprised the two floating production ships "Crystal Sea" and "Crystal Ocean". It was only mentioned in a footnote in the first prospectus that SeaDrill did not own, but had the option to purchase the ships. The owner was Fredriksen-controlled Active Capital, the debt collection agency that benefitted from the enormous tax deductions associated with the ships when they were picked up from the failed Brøvig company Crystal Productions. Now, the ships were ready for a new round in the Fredriksen family of companies. Half of Norway wanted to subscribe for shares, and Trøim had to diligently cross off names on the subscription list. Just days after the allotment, the price had almost doubled. No one wanted to miss out on a new Frontline. The information was scarce; the brokers had some blurry photos of rigs with Russian names, there were two production ships and a couple of construction contracts. Based on this, ambitious financial projections were made for the coming years."

"It was the legend John Fredriksen the market was buying. They sensed that things would move fast, Fredriksen had aimed to consolidate the industry, nothing less. And one would not be slowed down by formalities, the board of SeaDrill was fully recognizable. Moreover, one could expect that the money would go to the shareholders as soon as there was something to distribute, everyone had learned that lesson. Such things are particularly liked in the homeland of dividends, the USA. When Frontline announces a large dividend, it is a topic on the major TV channels across the country. In the USA, John Fredriksen is big, he is the only Norwegian who matters in international business. – Are you a friend of John? is the control question you get in finance. Then it’s important to know Big John. Even though the information in SeaDrill was sparse and the figures airy, it was absolutely rational to shift focus from oil tankers to rigs. A supertanker and a drilling rig cost almost the same to build, but the rig commands much higher daily rates, even adjusted for significantly higher costs. Therefore, Fredriksen ordered new rigs and drilling vessels at a furious pace in the summer and fall of 2005, and with each order came the option for more. In a short period, contracts worth 10 billion kroner were signed."