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Finland Readies $3.7 Billion Assets to Fund Digital Ventures

Updated on
  • Alcohol maker Altia’s IPO could bring the first assets to Vake
  • Government appointed Vake’s board of directors on Thursday

Finland’s government wants to generate cash from a part of its equity holdings to fund investments in start-ups in digital and platform businesses.

The new investment vehicle, Vake Oy, is being readied to manage assets worth about 3 billion euros ($3.7 billion), according to Jyrki Knuutinen, who started as the director of the Finnish government state ownership steering department last month. The first investments could be made as early as by the end of the second quarter this year, he said.

The government on Thursday appointed a board for Vake, joining Chairman Reijo Karhinen, who was given the job in November. Maria Ritola, Paula Laine, Tuomas Syrjanen, Leena Morttinen and Jarmo Vaisanen were selected for a one-year term beginning March 1, according to people familiar with the matter. The government confirmed the appointments on Friday.

Vake is expected to seek to identify investment targets primarily in Finland, with a focus on companies engaged in the platform economy, digital services and Internet. Vake’s mission is to convert “passive ownership in larger companies into ownership in smaller start-up companies,” Knuutinen said in an interview on Thursday.

The government of Juha Sipila decided two years ago that some, or all, the stock in companies such as Neste Oyj, postal company Posti Group Oyj or ice-breaker operator Arctia Oy could be transferred Vake, which would use dividends to fund its new ventures. The state may also dispose of entire companies to generate returns.

One option the government is weighing is an initial public offering of alcohol-maker Altia Oyj, which may be the first to bring funds to Vake. The government said in December that a final decision on the IPO should be taken during the first quarter. It’s up to the government to ultimately decide, Knuutinen said.

(Adds confirmation of board appointments.)
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