Norway Bulks Up on FTSE 100 Companies

(July 16, 2012) — Norway has become the largest sovereign shareholder in FTSE 100 companies after amassing $30.7 billion (£25 billion) of holdings, according to a recent analysis by the Sunday Telegraph.

The fund’s purchase makes it the largest state investor in the UK’s blue-chip index and the third largest overall, according to the newspaper’s investigation. The stakes include luxury brand Burberry, UK retailer Marks & Spencer, insurer Prudential, property investor British Land, and Rolls-Royce. The stakes are operated through Norges Bank Investment Management (NBIM), which manages the Norwegian oil-revenue fund.

The Sunday Telegraph‘s investigation also revealed that the Norwegian state’s purchases of FTSE 100 companies equate to about 50% of the roughly 4 percent of the index held by the biggest investor in the FTSE 100 — Legal & General. Norway now ranks third after fund manager Blackrock.

The Norwegian sovereign wealth fund’s large-scale ownership of FTSE 100 companies follows its revealed optimism about the long-term prospects for Europe. The optimism, articulated by Norges Bank Investment Management’s CEO Yngve Slyngstad in an interview with the Financial Times last year was belied somewhat by the fund’s decision to shift more of its assets into emerging markets in June of 2011.