HMC: Who actually owns SWN?

SOURCE: http://www.mediacoop.ca/blog/max-haiven/19452

by Max Haiven

The struggle of the people of Kent County New Brunswick against fracking, and the phenomenal resistance at Elsipogtog this October, has generated a lot of buzz online.  Many people, both local to Mi’Kmaqi (Atlantic Canada) and beyond want to help. One way to help is to put economic pressure on SWN, the corproation that is responsible for the shale-gas testing and whose “thumper” trucks were so heroically seized until the RCMP raid on October 17.  Recently, some have referred to this website <http://stockzoa.com/ticker/swn/> to argue that SWN is actually owned by major global brands like Microsoft, Nike, Exxon, Disney and Philip Morris.

This is inaccurate.

SWN is a publicly-traded corporation, which means that its shares are traded on the New York Stock exchange and its “owners” are multiple individuals and corporations.  Because it is “publicly” traded, it must report who its major investors are, and this is where the stockzoa.com information comes from.  If we look at the list, we can see that most of those owners have obscure names.  Here are the top 5:

Capital Research Global Investors^ 20.98M $766.48M June 30, 2013
Sands Capital Management 18.10M $661.33M June 30, 2013
Vanguard 16.86M $615.91M June 30, 2013
Wellington Management Company 16.23M $592.83M June 30, 2013
T. Rowe Price Associates 15.40M $562.58M June 30, 2013

These are all “funds,” which means that each of them is itself a company made up of multiple investors.  In other words, each of these “investors” is itself a corporation, made up of multiple investors. Because most of these funds are “private,” we don’t get to know who those investors are.  They are most likely a combination of (a) very rich individuals, (b) investment banks, (c) pension or mutual funds which manage people’s retirement savings and (d) possibly (but not likely) major corporations (like Nike, WalMart, Microsoft, etc.).

Now these “funds” are ALSO investors in all those global brands mentioned above (Microsoft, Nike, Exxon, Disney and Philip Morris).  Funds like these work by making multiple investments in many different companies and creating a “portfolio” of stocks.

In other words:  SWN is NOT owned by Microsoft, Nike, Exxon, Disney, Philip Morris, etc.

The same FUNDS that own SWN ALSO own shares in Microsoft, Nike, Exxon, Disney and Philip Morris, etc.

The exception is invetsment banks.  The stockzoa.com page shows us that some major banks DO own part of SWN.  Hence:

GOLDMAN SACHS 10.29M$376.04MJune 30, 2013 JPMORGAN CHASE & CO 3.15M$114.89MJune 30, 2013

(Due diligence: I am not an expert in investments, but I am a specialist in the sociological and cultural dimensions of finance capital.  You can see a relatively readable piece I wrote on the subject here: http://truth-out.org/news/item/16911-financial-totalitarianism-the-economic-political-social-and-cultural-rule-of-speculative-capital)

WHAT DOES ALL THIS MEAN?

1. Boycotting brands that own SWN is very difficult.  Most of them are extremely secretive private funds whose offices are in New York, Conneticut, LA, Boston or the Cayman Islands.

2. More problematically, it is not unlikely that many Canadians (and certainly many Americans) are unwitting investors in SWN and other fracking companies because their banks or pension funds are making investments wither directly in SWN stock, or in the funds that are, in turn, buying SWN stock.

3. On the bright side, because SWN is made up of multiple investors and publicly traded, their share prices can be affected quite dramatically by bad publicity. If investors believe that the firm is in trouble in New Brunswick, they may be tempted to sell the stock, which can cause SWN’s share price to drop.

4. But convincing these funds to divest from SWN is likely a losing strategy.  These funds are not run by conscientious individuals. They are run by ruthless professional fund managers whose only legal responsibility is to make as much money for their clients as possible. Trying to convince them to do otherwise is like trying to convince a shark to try a vegetarian diet.  Most of the investors in the funds have little to no idea where there money is going.

SO

Efforts to hurt SWN economically would more effectively occur on other fronts:

1.  The civil disobedience in Kent County will continue to cost SWN a huge amount of money.  Some estimates put it at over $60,000 a day.

2.  Economic efforts should be directed at SWN’s local and more vulnerable partner, Irving, who have been providing private security for SWN, whose newspapers in NB have been criminalizing and defaming anti-fracking protesters, and who will gain materially from a shale-gas industry in the province.  Irving have allowed SWN to use one their lots to store their equipment. Irving owns (a) Irving gas stations and home heating, (b) Majesta and Royal paper products, (c) Cavendish Farms (who make a large percentage of North America’s french-fries) and (d) Kent Building Supplies, and much more.  Without Irving’s support (both material and political) SWN and Fracking in New Brunswick would be history. In Halifax, solidarity protesters have been holding demonstrations outside Irving gas stations since the summer, and more are planned in the future.

3. Economic efforts can also target local (Atlantic Canadian) fracking companies, notably Corridor Resources (http://www.corridor.ca/), a Halifax-based comapny (traded on the Toronto Stock Exchange) that has already fracked in Penobsquis NB, and is planning to undertake the incredibly dangerous practice of deep-ocean drilling in the Gulf of St. Lawrence.

4.  More generally, while SWN is the company responsible for fracking in Kent County, Canada has the dubious honour of being the world’s leader in mining and resource extraction corporations, and many of these corporations are committing heinous crimes against Indigenous people around the world.  These mining companies are, for the most part, traded on the Toronto Stick Exchange, and almost every Canadian who has a pension or a mutual fund is, unwittingly, an investor.  Divestment campaigns against Canadian mining companies would be very helpful.

Meanwhile, there are desperate financial needs at the protest camp in NB to help cover legal and bail fees.  To make a donation, check out sacredfirenb.com.

Those in Halifax can join in solidarity actions this Monday at the Irving Station at the corner of Robie and Charles Street at 3pm: https://www.facebook.com/events/167445490121276

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