Value creation analysis for private equity funds in Norway 2022

In this analysis, we study the activity of the Norwegian companies owned by PE funds, in the form of value creation and employment. The analysis is based on a data set that combines PE portfolio data for Norwegian enterprises with register data from Menon’s historical database of accounting information for Norwegian companies. The analysis can be summed up in the following main findings:

Value creation: Today’s portfolio companies had a total value creation of NOK 92 billion in 2022.¹ This constitutes 2.9 percent of Norwegian mainland GDP. The portfolio companies experienced a sharp increase in value creation in 2022 after a moderate decline in 2021. Among the most important explanations are higher petroleum prices and reopening after the coronavirus pandemic.

Employment: Norwegian companies owned by private equity employ 89,800 workers, an increase of 1,500 more than in 2021. The figure primarily includes employment in Norway, but also captures employment through subsidiaries in other countries for companies with headquarters in Norway. The employment growth in 2022 has been somewhat more moderate than in previous years.

Growth: The development of the companies in the period before and after they were acquired by private equity funds shows that the growth rate of portfolio companies continues, and in some cases increases, in the years following the investment. Particularly strong is the growth among early-stage companies two to three years after the equity fund entered. The result is a clear sign that private equity funds contribute to the further development of portfolio companies through the provision of capital and expertise.