• Norway’s sovereign wealth fund, the world’s largest, will not be allowed to invest in private-owned companies such as Airbnb and Uber.
  • The Finance Ministry rejects the fund’s own advice to diversify into unlisted shares, primarily through private equity funds.

“We are concerned about the reputation of the fund. Openness is very important for the fund’s legitimacy, its trust,“ Finance Minister Siv Jensen told reporters on Tuesday according to Reuters.

“It is very likely that the lack of information in those types of investments would be problematic.”

Moving into unlisted shares is not compliable with the management model, based on transparency, low management costs and a limited degree of active management, states the Finance Ministry in its annual white paper on the fund to parliament.

It’s a disappointment for the fund which has argued that such investments could help improve its balance between risk and return. The fund has specifically named Uber and Airbnb among missed opportunities due to the current restrictions.

Per Strömberg, Professor of Finance and Private equity at the Stockholm School of Economics, lead an expert group looking at Norway’s opportunities to invest in unlisted equites. He’s surprised by the decision not to proceed.

“I am sympathetic to the complexity of changing policy but it is likely to come at a considerable cost in lower returns in the future,” he says to Financial Times.

There’s one exception to the rule which the fund still can exploit, the ministry said. It already has permission to take stakes in companies that have announced that they will go public.

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