The state investment company Solidium starts investing in growth companies as well. The return on the company’s shareholdings was 5.4 percent in the financial period that ended in June.
Finland the state-owned investment company Solidium is changing its strategy. In the future, the company also plans to invest in growth companies.
In the past, Solidium has chosen as investment targets companies that are nationally significant at the time of investment. In the future, the company may also invest in companies in which significant potential is seen to grow into a nationally significant one in the future.
Solidium says that it will continue as an active owner in these cases as well. The company’s goal is that its holding companies perform better than their peer companies in the long term.
“We enable growth with our capital, we bring know-how about capital markets, we support and challenge the company in creating shareholder value. In addition, in buyout situations, we consider that these companies will not be bought too cheaply in opportunistic situations,” Solidium’s press release reads.
According to Solidium’s press release, the strategy change is related to personnel changes in its top management. The chairmanship of the company’s board was transferred last year From Harri Sailas Jouko Karvisene and Reima Rytsölä became the company’s CEO Antti Mäkinen in place of.
“With the new chairman of the board and the CEO, it was natural to review Solidium’s strategy and update it as necessary,” the announcement reads.
Solidium told about its new strategy in connection with the publication of its financial statements. The return on the investment company’s share holdings was 5.4 percent positive in the financial period from last July to June of the current year, but 2.1 percent negative from the beginning of the year to the end of June.
The result for the fiscal year that ended in June was 471 million euros, and Solidium says that during that period it distributed a dividend of 307 million euros to the state. In addition to this, Solidium distributed more than 130 million euros in the form of Fortum’s subscription rights as capital return.
Solidium’s board of directors proposes that the company distributes a dividend of EUR 290 million for the fiscal year ending in June.
In the press release, Solidium’s CEO Reima Rytsölä describes the financial year’s income as reasonable.
“At the beginning of Solidium’s fiscal year, the market feared a widespread global recession, but the worst did not materialize. The financial period was overshadowed by, among other things, concerns about the sufficiency of electricity, increasing geopolitical tensions and tightening of monetary policy.”
Solidium currently owns shares of 12 listed companies. It is a minority owner in all these companies. The total value of Solidium’s investment assets is around 7.5 billion euros.
Measured in euro terms, Solidium’s largest holdings are in Sammo, Metso, Nokia and Stora Enso. The company owns Sampo with more than 1.3 billion euros, Metso with slightly less than 1.3 billion euros, Nokia with almost 1.15 billion euros and Stora Enso’s two different share classes with a total of just under 1 billion euros.
Managing director Rytölä commented Kauppalehtin in connection with the results announcement, among other things, Nokia, which is part of Solidium’s billion holdings.
Over the past year, Nokia’s share price has fallen by almost 30 percent, when, for example, the shares of many technology companies in the United States have become more expensive.
This summer, Nokia issued a profit warning and reported a reduced operating profit of almost EUR 100 million in the second quarter of the year. Managing director Pekka Lundmark assured HS after the announcement of the results that the decline in the company’s profitability is caused by the market, not by the company itself.
According to Kauppalehti, Rytölä admitted when asked in connection with the results announcement that the weak success of Nokia’s stock might expose it to an outside takeover.
“There is a danger that when the fundamentals are good, and now the stock is really undervalued, so that the company would start too cheaply,” Rytölä said, according to Kauppalehti.
However, Rytölä says that he believes Nokia’s backwater phase will be short-lived.
“The problem now is more that the valuation level is falling quite strongly. I am confident that the issue is on the agenda of the company’s management,” he said according to Kauppalehti.
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