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Swedish pension funds to collaborate on alternative investments

Three Swedish state controlled pension funds work together to reduce costs of investments in infrastructure.

Photo: Ritzau Scanpix/Henning Bagger.

The state controlled pension funds in Sweden - altogether known as the AP funds - continue to integrate parts of their investment strategy.

This time, AP1, AP3 and AP4, work together to found a new company whose purpose is to make broad investments in infrastructure.

Head of Communication at AP1, Sara Christensen, tells FinansWatch, that each of the three funds places SEK 3bn in the new company, which has been named Polhem Infra.

That brings the total capital for management to SEK 9bn. It is not the first time for multiple AP funds to join in on investments in unlisted assets.

"We already have a collaboration on real estate, especially, but also other types of infrastructure, particularly in the energy sector, that we work on together," AP1 Head of Communication, Sara Christensen, explains to FinansWatch.

Founded in the 1960s, the AP funds, remain the backbone of the Swedish pension system. The various funds were founded in order to spread the risk on different asset management strategies.

January 1, 2019, a new law entered into effect. The law requires companies to make more sustainable investments - which is exactly the objective aimed at by the new structure at Polhem Infra.

"In Sweden, there is a significant need for both public and private investments in infrastructure. Parts of the existing infrastructure will require big investments in order to live up to social demands for quality and sustainability," top executives of the three AP funds announce in a shared statement of a press release.

Swedish AP funds and Church of England in initiative to set new global mining regulations 

McKinsey recommends new investment rules for AP funds 

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