February 3, 2011 11:14 pm

Nordea stake sale set to net Sweden $3bn

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Sweden’s government is to sell up to 6.3 per cent of Nordea to institutional investors, marking the start of the disposal of its large shareholding in the biggest Nordic bank.

At Thursday’s share price, the stake would raise just over $3bn for the Swedish treasury. The disposal, due to take place in an auction on Friday, would be the first in a renewed round of planned privatisations by the centre-right government after it was re-elected last September.

The government’s 19.8 per cent stake in Nordea has long been high on the list of assets earmarked for sale but the finance ministry sprang a surprise late on Thursday by announcing an almost immediate start to the process.

Shares in the bank have climbed close to their highest point in nearly three years as Sweden’s well-capitalised lenders have emerged as a haven from financial turmoil in the eurozone.

The government plans to initially sell 200m Nordea shares, with the possibility of extending the offer to a further 55m shares. Shares in Nordea closed at SKr78.40 on Thursday, valuing 255m shares at nearly SKr20bn.

“Revenues from the sale will be used to enhance the stability of the Swedish economy, by reducing the national debt,” said Peter Norman, financial markets minister.

The offer will be open to Swedish and international investors through an accelerated bookbuilding process run by Nomura, Morgan Stanley and SEB.

Nordea, which operates across the Nordic region and in the Baltic states, was nationalised after the Nordic financial crisis of the early 1990s. The government has since gradually reduced its stake as the bank returned to health.

The lender highlighted its strength on Thursday when it announced an 81 per cent increase in fourth-quarter net profits, aided by strong economic recovery in the Nordic region and stabilisation in the crisis-hit Baltic countries.

Other companies in which the Swedish government could sell stakes include TeliaSonera, the mobile operator, SBAB, the mortgage lender, and SAS, the airline.

During its first term in office, the government, led by Fredrik Reinfeldt, prime minister, sold Vin & Sprit, the vodka maker, as well as its stake in OMX, the stock exchange operator, among other assets. However, the sell-offs ground to a halt when the financial crisis struck.

The government vowed to resume the privatisations after the election as global equity markets recovered, although opposition parties have threatened to halt the plans in parliament.

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