Insolvent Icelandic retail bosses given gift of shares by liquidating bank

A group of key owners in Icelandic retail giant Hagar have made a deal with Arion Banki to keep a share of the business, despite its having been insolvent and taken over by the bank.

The deal with Arion will see key executives keeping a slice of the company worth around ISK 330 million (EUR 2.07 million). They will not pay anything for the shares and will not need to pay tax on them either, according to the contract with the bank.

Having made the deal, Arion will now be able to sell on the remaining 97.5 percent of the company.

Hagar runs many of Iceland’s biggest shops, including the Bónus and Hagkaup supermarkets.

Vísir.is reports that Arion Banki has not released any details about which Hagar bosses will be given shares; but it is known that current president of the company Finnur Árnason is among them.

The latest reports value Hagar at around ISK 13 billion (EUR 81.35 million). The stake being gifted to its former execs is worth around ISK 330 million, and is therefore around 2.5 percent of the business.