Hurtigruten Svalbard plans to sell property | Polarjournal
Among the properties owned by Hurtigruten Svalbard is the Radisson Blu Polar Spitsbergen, the largest 128-room hotel in Longyearbyen. Hurtigruten had recently modernised and expanded the hotel to meet the growing number of tourists. But that was before COVID. Picture: Michael Wenger, archive image

Some time ago, an article in Norwegian media caused a stir. The author of the article, Per Arne Totland, spoke of the possibility of foreign takeovers of companies based on Svalbard. In particular, he raised the likelihood of a Chinese takeover of parts of Hurtigruten or the whole company, but also pointed out that this was only speculation. Now Hurtigruten Svalbard has surprisingly announced that it wants to sell its properties in Longyearbyen.

The properties offered for sale include three hotels, shops and several apartments with a total market value of € 21.5 million (as of 2019), many of them in a prime location. But according to the new manager of Hurtigruten Svalbard, Per Brochmann, a sale at the beginning of the year was not an issue. He told the media that the company had been approached by several international stakeholders, but that the issue had only come up again when he started work about a month ago. In the meantime, a contracted company has started to evaluate the properties and a possible sale.

Hurtigruten Svalbard had created a joint venture, Svea Svalbard, with the state-owned Store Norske company, which is the largest property owner in Longyearbyen. But with the closure of the Svea coal mine, this project was buried. Now Store Norske has announced its interest. Picture: Michael Wenger

According to the press release, potential buyers of the properties have already been identified. Among them is Norway’s stalite on Svalbard, the Store Norske company. The former coal mine operator had been already asked by the state a year ago to set up new pillars. This was after the closure of the Svea coal mine and thus the end of commercial coal mining on Svalbard had been decided. Among the guidelines was the expansion of tourism on Spitsbergen, which Store Norske sees as an opportunity. The managing director of Store Norske on Svalbard, Jan Morten Ertsaas, also confirms to the media that his company is ready for talks with Hurtigruten Svalbard after consultation with the owner of Store Norske, the Norwegian Ministry of Trade, Industry and Fishing.

For tourists as well as for the locals, the shops in Longyearbyen are vital, not only because of the goods. Businesses are an important employer. Many are Norwegian companies, which are thus also an important aspect of Norwegian sovereignty. That is why Per Arne Totland is advocating a stronger commitment by the state to counteract a sell-off. Picture: Michael Wenger

Store Norske’s interest in Hurtigruten Svalbard’s plans meets the wishes of various local representatives. On the one hand, they look forward calmly to a possible sale and see it rather as an opportunity for the economic development of Svalbard, but at the same time they want a local society or company, which is already rooted and networked in the community, as a new owner. Furthermore, they do not see a need for upheaval, since it is not to be assumed that Hurtigruten Svalbard will sell out completely, but rather to divest a business branch in order to concentrate on the other areas of the tourism business. Per Brochmann also confirms that there is no interest in withdrawing completely. They have a clear long-term perspective and want to continue investing in Svalbard as a destination, he told the media.

Author and analyst Per Arne Totland does not believe that Hurtigruten Svalbard has a sale in mind only to local buyers. That is why he is calling for Norway to intervene, as it did in 2016, when Norway bought land in the Austre Adventfjord to avoid a Chinese purchase offer. Photo: Wilhelmstormer – Eget verk, CC BY-SA 4.0

However, the author of an article published a few days ago about a possible Chinese interest in Hurtigruten and Svalbard, Per Arne Totland, does not believe that Hurtigruten may have an interest in the properties remaining in local hands. He is more likely to believe that the properties will go to those with the highest bid, as he says in an interview with Svalbardposten. That is why he also reiterates his call for action through the Norwegian Government. The question will also be whether the government will be willing to provide additional money for this transaction. It only had published a budget for Svalbard at the beginning of October, in which a double-digit million amount is planned for various projects in the archipelago. The minister responsible for Svalbard has not yet commented on the issue in response to questions from the media.

Dr Michael Wenger, PolarJournal

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