Private Equity in Sweden: A Financial Stability Perspective (Sveriges Riksbank)

Summary

• In 2023, there were over 8,000 funds globally invested in private equity, managing assets totalling more than USD 7.4 trillion.p.9
• Funds located in Sweden represented less than 2.5 per cent of total global assets under management in 2023.p.9
• Since 2010, private equity firms have acquired approximately 3,400 Swedish companies through buyouts and invested venture or growth capital in almost 10,600 Swedish companies.p.12
• Companies in Sweden that have been subject to a buyout within the past seven years are estimated to employ nearly 364,000 people.p.12
• Following a leveraged buyout, short-term debt levels in Swedish portfolio companies rise by almost 20 per cent compared to similar non-private equity-financed peers.p.15
• At the end of 2023, assets under management in private equity funds regulated in Sweden totalled over EUR 20 billion, or SEK 230 billion, across 132 buyout funds and 132 venture capital and growth funds.p.19
• As of 2024, an estimated 140 Swedish investors hold close to 1,000 active commitments to private equity funds, with nearly two-thirds held by insurance corporations, pension funds, and state-owned AP funds.p.24

Key insights

1. Short-term debt levels in Swedish companies rise by almost 20 per cent post-leveraged buyout compared to a control group of non-private equity-financed peers.p.15
2. Post-buyout interest costs for Swedish portfolio companies increase by about 20 per cent relative to comparable non-private equity-financed firms.p.16
3. The role of Swedish banks as lenders in leveraged buyout transactions has declined over time in favour of international private credit funds.p.4
4. Median gross leverage for both buyout funds and venture capital funds regulated in Sweden is close to 1x.p.22
5. Private equity fund commitments represent approximately 3 per cent of the total portfolio of listed securities and commitments for Swedish insurance corporations and pension funds.p.27
6. More than half of the private equity funds to which Swedish institutional investors have committed capital have only 0 to 10 per cent of their original dry powder remaining.p.29