Earlier this week, Seadrill made a somewhat surprising announcement: It was looking for a new home for its corporate headquarters and Alf Thorkildsen, the CEO, was resigning.
Now, normally, the sudden resignation of a company's CEO should set off all kinds of warning bells, sirens, and whistles in an investor's head, but for this company and this situation, you can kill the sound track. That's because the CEO at Seadrill is not the one calling all the shots; instead, it's controlled by "Big Wolf" John Fredriksen, chairman of the board, who owns 25% of the company.
The two events are related. Fredriksen has finally decided to move corporate headquarters out of Stavanger, Norway, to more, shall we say, conducive climes. It's not the cold winters driving this move, but, I suspect, Fredriksen's long-running dispute with his native country. While what the company says about hiring and retaining highly qualified employees is difficult in Stavanger and the location is too far from key markets is almost certainly true, I'm sure his history with Norway (he renounced his citizenship during a tax dispute with Norwegian officials several years ago) is also contributing. Likely new locations include London, Dubai, Singapore, and Houston.
As a result of the decision, Thorkildsen, who's a Stavanger native, "quit on the spot" according to one report. He had joined the company via Seadrill's acquisition of Smedvig in 2006 and had helped grow Seadrill from its humble beginnings to having the fifth largest fleet among offshore drillers. He'll stay on as a director of North Atlantic Drilling, a subsidiary of Seadrill.
He's been replaced by Fredrik Halvorsen, who left his CEO job at Archer – which is 40% owned by Seadrill – to take the role.
Because of the way the company is controlled, I do not believe this should be a worrisome event for investors. Several analysts agree, calling it a loss, but not a catastrophe for Seadrill. I'll keep an eye on the situation, updating you as necessary as the company proceeds with drilling operations under Halvorsen's leadership.
At the time of publication, Jim Mueller owned shares of Seadrill.
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