Norwegian equity fund participates in the largest stock market of the year – E24

There was huge interest in becoming a shareholder when the technology company went public. Nordea Fund took a piece of the ARM cake.

Arm shares were on a tear when the company, which designs chips for nearly all of the world’s smartphones, went public this week in New York.

On the first day of trading, the value of the company’s shares increased by a quarter, or $11 billion.

When the company raised money by selling stock before its IPO, interest was so high that many investors failed in their attempts to get the company on the stock exchange.

But Norwegian investment fund Nordea Norge Verdi succeeded in acquiring a smaller stake in the company’s shares.

-We got a little one feefeeSubscribing to shares to increase the company’s capital means trying to buy shares in the company“, says investment director Robert Ness at Nordea.

The manager says the fund has been allocated shares worth “a few” million kroner.

– At high prices

In advance, an army of 28 banks worked to sell the IPO. Mediators gathered more than 100 managers of the world’s largest fund managers in a New York hotel to convince them that this was their chance to make big money from artificial intelligence, according to the British newspaper “Daily Mail”. Financial Times.

They sold 95.5 million shares of Arm at $51 per share, for a total stock value of $4.9 billion. The amount corresponds to 53 billion Norwegian kroner.

The stock sale made the initial public offering the largest of the year.

There has been excitement surrounding the company’s stock market debut, as it is seen as a tough test for the currently tough IPO market.

Warm welcome from investors Can Encouraging more companies to offer their shares for public offering and putting an end to the weakness period for initial public offerings.

“Their prices are high, but they also make good money,” says Ness, who believes the current prices are unheard of.

Arm was priced at $54 billion before its IPO. This amount is equivalent to 581 billion Norwegian kroner at today’s exchange rate.

He manages billions

Næss points out that Arm has grown strongly, and he believes the growth will continue for some time.

He saw the value of the arm rise about 25 percent on the first day of trading.

– The case was about ten times OversubscribedOversubscribedInvestors will buy more shares than the number of shares available for sale in a company’s capital increase It is therefore not unusual for the share price to rise on the first listing.

Nordea Norge Verdi mainly invests in stocks on the Norwegian stock market, but an information document states that the fund can invest some money in companies listed on foreign stock exchanges.

The fund had assets under management of NOK 4.7 billion at the end of the first half of 2023. This means that the investment in Arm is small compared to the fund’s total assets under management.

Skeptical

In an interview with CNBC On Thursday, Softbank CEO Masayoshi Son emphasized how Arm’s technology will be used in AI chips, in an attempt to link the company to the ongoing AI boom.

But not everyone was convinced.

Among them is James Anderson, one of Britain’s most famous technology investors. Anderson according to Financial Times He warned that the British company is not a decisive player in important growth markets such as artificial intelligence and cloud services.

Arm’s IPO is a victory for the Nasdaq over the New York Stock Exchange. The rivalry between New York’s two most important stock exchanges goes back several decades. In the hunt for the biggest IPOs, stock exchanges promise announcement time and hold lavish IPO parties at their offices, writes The Wall Street Journal.