Sixteen pension funds within the National Association of Pension Funds formally established an investment group called Framtakssjódur Íslands (“The Enterprise Fund of Iceland”) on Tuesday, which is meant to help restore the economy.
Photo by Páll Stefánsson.
An announcement described the fund as “an investment group intended to participate in and develop the financial and operational restoration of the Icelandic economy following the collapse of the financial system,” Fréttabladid reports.
The announcement states that the investment fund’s founders are in control of 34 percent of the total assets of pension funds in Iceland and are obligated to contribute around ISK 30 billion (USD 240 million, EUR 163 million) in equity to the investment fund.
According to RÚV, the initial capitalization is only half the amount originally proposed. Initially, as many as 20 pension funds were planning to participate in the project.
“Of course we would have liked to see a higher number but 30 billion is still high,” said managing director of the Confederation of Icelandic Employers (SA) Vilhjálmur Egilsson, adding that in light of delays of the economy’s restoration, this is a good start.
The fund is planning to invest in viable Icelandic companies from all sectors. It will neither participate in the construction of a new hospital building in Reykjavík, nor invest in a new hydropower plant on Búdarháls.
It is possible that investors other than the pension funds will be able to join the fund’s projects at later stages.
Click here to read more about the new hospital.