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Norwegian oil fund now second biggest owner of Volvo Sweden

Thursday, 25 April 2013
Capitalism makes it that Sweden's western neighbour; Norway can bully Sweden and take any asset they want. They have the money and they stand taller even though they are smaller. Who says money doesn't bring happiness and does not create power.

Volvo AB used to be a company were many Swedish people put their money to do business just as they do with the telecoms giant Ericsson. As the Norwegians came to have lots of money from their enormous oil wealth, they started looking for places to invest it in.

At first not lot of interest was found in Sweden and they ignored Sweden. Then later they realised that Sweden was one of the most creative countries in the world and that they have some assets that had very powerful core values that do not easily erode with market validity or economic uncertainty.

The Norwegian State then looked at the heart of Sweden, Volvo, and timed it properly. On April 19, the Norwegian oil fund which is the world's largest mutual fund, bought shares in Volvo for another Skr900 million. The stock dealer,  SIS Ägarservice show that transaction in its summary as reported Swedish business daily Dagens Industri.

The means that Norwegians now owns 5 percent of Volvo thereby sailing past the Swedish institutions Alecta, Robur and Pension fund, AMF in the ownership list.

Shareholding has been building up gradually since the beginning of 2009.
In December 2012, the holding increased from 3.8 percent to 4.7 percent when the French Renault sold all their Volvo shares. Oil Fund devoured a large part of Renault's shares and hence climbed the ownership table.

With its large shareholding in Volvo being the Norwegian state, it became one of the  winners of Thursday's stock market, where the truck company increased in market value by more than 2 percent after the interim report showed new orders much better than expected.

So despite reporting, looses, the company's stock has risen by 5 percent since the Norwegians filled in their presence in the portfolio last week. The increase is partly even as rival Scania showed strong order intake in its report, which should indicate a better truck market in the future also for Volvo.

The Swedish principal owner of Volvo at the moment Industrivärden, which owns 6.5 percent of the truck manufacturer. Industrivärden still has control over Volvo, through its multiple voting class A shares have almost four times as many votes at the General Conference as the western money power oil fund state.
by Team

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