Private Equity funds in Norway 2023Activity Report 2023

In 2023, Norwegian fund managers invested a total of NOK 13.3 billion, marking a 30 percent decrease from the previous year. Of this, NOK 3.4 billion was allocated to Norwegian portfolio companies, representing a 68 percent reduction compared to 2022. This significant drop follows a record-setting investment in Norwegian firms in the prior year. In contrast, investments in foreign companies experienced growth, with NOK 9.8 billion invested in 2023, a 21 percent increase from the year before.

In 2023, Norwegian private equity funds made 150 investments, reflecting a 32 percent decrease from 2022 and marking the lowest investment activity since tracking of the market started in 2007. Among these, 16 investments targeted foreign companies, showing a nearly 40 percent decline from the previous year. Investments in Norwegian portfolio companies fell to 134 in 2023, down from 195 in 2022.

Following a record-breaking year in 2022, the amount invested in companies in the buyout phase declined in 2023. The level declined from NOK 17.3 billion in 2022, to NOK 11.1 billion in 2023. This downturn primarily resulted from a decreased number of investments, while the average deal size remained consistent year over year. Most investments in the buyout phase were initial investments.

Both the volume and the value of seed phase investments experienced significant decreases in 2023, down by 50 and 55 percent respectively. Contrarily, the venture segment witnessed a near 80 percent surge in invested capital, despite a drop in the number of deals. Therefore, the substantial growth in funds allocated to venture companies was entirely due to larger deal sizes.

Among Norwegian firms, companies within business related services and industry services attracted the most capital of all sectors, more than NOK 4.1 billion. This was largely driven by three large transactions.

The IT sector attracted second most capital with NOK 3.9 billion invested. This represents a decline by over 50 percent from 2022. However, the level was still well above the historical average in the period 2007-2019. The cleantech sector attracted NOK 2.9 billion, making it the third most popular sector in terms of invested amount. Despite invested amount in the sector declined compared to 2022, the investment level is far above the historical average.

In terms of the number of investments, ICT companies attracted more than 40 percent of all investments made by Norwegian PE fund. Life science companies attracted 32 investments, making it the sector with the second highest number of investments by Norwegian PE firms, both in total, and in the seed and venture phases. None of these 32 investments were made in companies in the buyout phase.

Exit activity in Norwegian PE firms slowed down further in 2023, with 22 exits in Norwegian PE firms, down from 29 in 2022. Only five exits were made in the venture phase in 2023, down from 10 in 2022. The number of seed divestments in Norwegian PE firms doubled from 3 in 2022 to 6 in 2023.

The value of exits in 2023 was NOK 3.15 billion, 19 percent higher than in 2022.