Rolls-Royce Pauses Sale of Bergen Engines

On Tuesday, it was announced that Rolls-Royce will temporarily stop the sale of the engine factory Bergen Engines to the Russian-controlled company TMH International.

"Rolls-Royce has not stopped the sale of Bergen Engines to TMH, but they have put the transaction on hold while the authorities do their investigations", says communications manager Merethe Fjeldstad at Bergen Engines to Norwegian newspapers BT / E24.

During a press briefing Tuesday Minister of Justice and Public Security Monica Mæland (Conservative Party) told reporters that the Norwegian National Security Authority (NSM) has informed Rolls Royce that Norwegian authorities are considering whether or not the planned sale of the engine factory Bergen Engines AS to TMH Group should be stopped with reference to the Security Act.

"The government has in recent months investigated this case, and it can not be ruled out that a sale of Bergen Engines AS to TMH Group may entail a risk to national security interests. There is therefore a need to take a break in this process to provide a sufficient factual basis for assessing the transfer", Mæland says in a press release.

Russian answer

In a Facebook post from the Russian embassy in Norway, the embassy writes that it has not received inquiries about assistance in implementing agreements between "ТМН International" and "Rolls-Royce Group" and that it is therefore impossible to give substantial comments on the case.

"The anti-Russian tonality of Norway's discussion raises serious concern. Attempts to watch ′′ double bottom ′′ in the actions of independent commercial actors look very strange and artificial. We count on the non-discriminatory approach of the Norwegian authorities to Russian business operators."

Contracts with the Norwegian Armed Forces

It was announced early February that Rolls Royce has signed a letter of intent about selling its Norwegian subsidiary Bergen Engines to THMH International for approximately € 150 million.

The Russian-controlled company TMH International is scheduled to take over ownership of Bergen Engines some time this year, according to E24.

The Navy is a major client of Bergen Engines. The  engine company has amongst others supplied main engines for Norway’s largest coast guard vessel and also its only icebreaker KV Svalbard, and for the Norwegian state-of-the-art surveillance vessel Marjata, as well as several NATO countries.

Wants to inform Stortinget

Mæland Tuesday submitted a letter to the Speaker of Stortinget requesting permission to provide oral information about the planned sales of the engine factory.

“There has been a lot of attention in the political community as well as the media about this matter. I therefore ask Stortinget for permission to provide oral information about the issue of using economic tools in relation to security threat activities, and how the Security Act can be used to counter this. In addition, I would like to inform about the work the government is doing in this area”, Mæland says.

Bergen Engines AS has not been covered by the Security Act and does not hold supplier clarification nor a security agreement with the Armed Forces.

“The Security Act may nevertheless be used in relation to the planned sale. The Act holds a wide range of tools to manage cases in which national security interests may be threatened. We thus have a space in which we may act, and this is what we are currently going thoroughly through”, Mæland says.