Icelandic pension funds buy into troubled oil company

The Enterprise Investment Fund of Iceland has purchased a 15.8 percent share in the country’s biggest oil company N1, from Islandsbanki and its deceased predecessor, Glitnir Bank.

The Enterprise Investment Fund of Iceland is owned by 16 independent pension funds.

N1 is Iceland’s biggest oil company, with service stations around the country. N1 has been in the news recently due to its financial difficulties.

The Enterprise Investment Fund intends to create a new company with Islandsbanki and several other N1 shareholders. The new company would then hold a majority stake in the oil firm and could guide its future course.

A statement from the Enterprise Investment Fund did not mention how much the stake in N1 will cost; the statement says that will depend on N1’s operational profit/loss for 2011.

N1 lost around ISK 12 billion (EUR 74.9 million) last year, according to the company’s annual report.