Hilmar Reksten - Postwar

Postwar

After the war he kept expanding his business, and in 1974 the company had ships carrying 2 million metric tons deadweight (DWT). At this point Reksten’s was the third largest shipping company in Norway - second only to Bergesen and Jahre - and thereby also one of the largest in the world. Reksten's business principle was simple: He refused long-term contracts, presuming that at intervals, political crises would cause an increase in freight rates. For a long period he was proved right. Both when the Korean war broke out in 1950 and the Suez crisis in 1956, Reksten profited. The fact that he, between each crisis, was on the verge of bankruptcy, did not in the least alter his conviction. His "Norwegian period" began in 1963 when he placed an order of seven large tank ships, worth 450 million kroner, with Akers mekaniske verksted (= Aker's mechanical workshop), 80% financed by his bank. It was even uncertain if the ships would find commissions when built. "But I did not have to show a bank guarantee," he boasted. "Because I refused to do so." He stood ready with 14 super tankers when the Suez Canal was closed in 1967. In 1968 Reksten placed an order for yet another seven super tankers from Aker, the largest ships the world had seen so far. He contacted other Norwegian shipping magnates, suggesting that they merge into one giant shipping firm. The others withdrew from the plan though, realizing that Reksten intended to dominate the colossus.

In 1970 Reksten signed the shipping contract of all times, when Libya cut down on oil production, while Nigeria was in chaos, and Syria closed the oil pipeline from the Middle East to the Mediterranean. Twelve of his super tankers were now hired out to British Petroleum under a contract providing Reksten with a net profit of 500 million kroner. The later "Reksten-case" originated in this giant sum, which was illegally transferred from Norway and hidden in secret "mailbox companies" abroad. To him, the profit was his, and his alone, and privately he had also ventilated the opinion that the tax policy of the Norwegian Labour party made it necessary to remove funds from Norway. Due to this action however, the Reksten empire had few funds to rely on when the freight rates dropped dramatically from 1971 onwards. The market was so slow that five of Reksten's super tankers were laid-up, while he was forced to sell out another two. He still had considerable orders placed at Akers mekaniske. This firm was worried to such a degree that it was suggested to declare Reksten bankrupt; but in the winter of 1972/73, freight rates went up again, helped by an increase in the import to USA, as well as fear of rising oil prices.