nordic investment overview in baltic states

NORDIC INVESTMENTS IN BALTICS

NORDIC BALTIC BUSINESS FORUM 2014

NOV 4TH 2014

NORDIC COUNTRIES’ FDI IN THE BALTIC REGION

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

Sweden Finland Norway Denmark

Year 2003

Sources: Bank of Latvia; Bank of Estonia; Bank of Lithuania. Conversion rate used: EUR 1 = LTL 3. 45280; EUR 1 = EEK 15.6466

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

Sweden Finland Norway Denmark

Year 2013

Estonia

Latvia

Lithuania

Inward FDI stock in the Baltic region 2003 vs. 2013, mln. EUR*

€6,71 bln2003

€17,28 bln2013158% ↑

195% ↑

111% ↑

401% ↑37% ↑

44% of FDI in Baltics

originate from

Nordic countries.

NORDIC COUNTRIES’ FDI IN THE BALTIC REGION

31%

13%

48%37%

26%

8%

32%

29%

43%

79%

20%34%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Sweden Finland Denmark Norway

Estonia

Latvia

Lithuania

LITHUANIA LATVIA ESTONIA

26%

29%

14%

22%

60%

49%

2003

2013

Sources: Bank of Latvia; Bank of Estonia; Bank of Lithuania. Conversion rate used: EUR 1 = LTL 3. 45280; EUR 1 = EEK 15.6466

8,445

3,867

4,972

0 2000 4000 6000 8000 10000

Estonia

Latvia

Lithuania

Inward FDI stock in Baltic coutnries 2013, mln. EUR*

Sources: Central Statistical Bureau of Latvia, Statistics Lithuania, Statistics Estonia, Eurostat Employment LFS Series*Statistics Estonia only collect datat on foreign controlled companies with 20 or employees or more

11,278

6,061

12,885

10,254

8,484

25,0028,257

3,792

4,717

9,334

5,830

4,467

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

Lithuania Latvia Estonia

Number of employees in Nordic controlled enterprises in Baltic States, 2012*

Denmark

Norway

Finland

Sweden

NUMBER OF NORDIC COMPANIES & EMPLOYEES

MORE THAN 2 000

ENTERPRISES

EMPLOYEES

MORE THAN 110 000

LITHUANIA

LATVIA

ESTONIA

3,08 %

2,78 %

7,92 %

SHARE FROM TOTAL EMPLOYMENT

Sources: Eurostat, EU direct investment positions*The latest available data on Estonia and Latvia are from 2012, on Lithuania – from 2011

NORDIC FDI BREAKDOWN BY SECTOR

SWEDEN FINLAND NORWAY

FINANCE 62%

MANUFAC-TURING 11%

MANUFAC-TURING 24%

REAL ESTATE22%

FINANCE 47%

WHOLESALE & RETAIL 21%

TOP 1

TOP 2

DENMARK

MANUFAC-TURING 24%

TRANSPORT & STORAGE 14%

ICT 8% WHOLESALE & RETAIL 20%

PROFFESIONAL SERVICES 13%

TOP 3 FINANCE 13%

An impressive 40% of total Nordic investments in the Baltic region are made in financial and insurance sector,while considerably less in other areas, such as manufacturing (9%), construction (7%), agriculture, forestry andfishing (7%) and information and communication activities (6%).


NORDIC FDI BREAKDOWN BY SECTOR SWEDEN

Sector breakdown of Sweden’s FDI in Baltic States*, mln. EUR

0 1000 2000 3000 4000 5000 6000

Others

Wholesale & retail trade

Professional, scientific activities

Real estate activities

Information and communication

Manufacturing

Financial and insurance activities Lithuania

Latvia

Estonia

€3,21 bln2003

€9,47 bln2013195% ↑


NORDIC FDI BREAKDOWN BY SECTOR FINLAND

Sector breakdown of Finland’s FDI in Baltic States*, mln. EUR

€2,05 bln2003

€4,32 bln2013

0 200 400 600 800 1000 1200

Others


Agriculture, forestry and fishing

Construction

Financial and insurance activities

Wholesale and retail trade


Manufacturing Lithuania

Latvia

Estonia

111% ↑


NORDIC FDI BREAKDOWN BY SECTOR NORWAY

Sector breakdown of Norway’s FDI in Baltic States*, mln. EUR

€0,48 bln2003

€2,05 bln2013

0 100 200 300 400 500 600 700 800 900

Others

Construction


Manufacturing

Professional, scientific activities


Financial and insurance activities Lithuania

Latvia

Estonia

403% ↑


NORDIC FDI BREAKDOWN BY SECTOR DENMARK

Sector breakdown of Denmark’s FDI in Baltic States*, mln. EUR

€1,05 bln2003

€1,44 bln2013

0 50 100 150 200 250 300

Others


Agriculture, forestry and fishing



Financial and insurance activities

Transportation and storage

Manufacturing Lithuania

Latvia

Estonia

37% ↑

Norwegian Visma Group acquires Latvia's IT company FMS (2014)

FMS Group is provider of Enterprise Resource Planning (ERP) and Business Intelligence (BI)software in Latvia with a market share of more than 30%. This will substantially expandVisma’s overall presence in the Baltic region. In 2013, FMS had a turnover of EUR 10.3 millionand had 197 employees, while Visma Group’s net revenue amounted to EUR 789.4 million andhad 5 642 employees.

RECENT INTERESTING TRANSACTIONS

Swedish East Capital Explorer very active in real estate acquisition (2012-2014)

Swedish investment company East Capital Explorer AB over the past years have acquired severallarge business and retail prorperties in the Baltics, including Vilnius Business Harbour (EUR 61.6million), Rimi Eesti Food’s logistics centre and headquarters (EUR 13.4 million), TänassilmaIndustrial Park (EUR 24 million) and others.

Swedish Runsven Gruppen acquires Estonia’s pharmacy chain (2014)

Swedish investor buys 70% stake in Estonia's third-largest pharmacy chain – Südameapteek Thetransaction creates a strong competitive advantage for Südameapteek to expand to the Balticand Nordic pharmaceuticals market. Südameapteek chain currently includes 68 pharmaciesand employs 285 workers.

Finns move production to Ogre and Kaunas (2014)

To improve manufacuring efficiency Finnish bakery Fazer Group plans to move its productionfacilities from Tallinn to Latvia and Lithuania In 2013, Fazer Latvija turnover was EUR 18.41million and the company currently has 250 workers. Meanwhile, Fazer Group reached aturnover of EUR 1.7 billion.

Orkla purchases Latvia’ s NP Foods Group (2014)

Norwegian company Orkla has entered into an agreement with Nordic Partners Food Limited topurchase Latvia's NP Foods Group and its subsidiary companies Laima, Gutta, Staburadze andMargiris. In 2013, NP Foods had a consolidated turnover of EUR 77.1 million and a total of 1 100employees, while Orkla’s turnover totaled EUR 4 037.5 million and the group had around 17 000employees.

RECENT INTERESTING TRANSACTIONS

Air traffic and ship control system manufacturer Jotron opens high-tech plant in Kaunas(2014)

Jotron, a Norwegian capital company and manufacturer of air traffic and ship control systems,opened a new high-tech plant in Kaunas, Lithuania. A total of EUR 2.7 million has been investedby the company in this manufacturing development project. The company is planning toincrease its production volume and establish a local product development department.

Finnish Energiakolmio Oy acquires market shares in Estonian company Baltic Energy Services(2013)

The leading energy market expert service company in Finland, Energiakolmio Oy, has acquiredone-third of the Estonian company Baltic Energy Services. Baltic Energy Services is the leadingelectricity portfolio manager in the Baltic region with 10 % market share in Estonia. Company’sturnover in 2012 was EUR 42.6 million.Energiakolmio operates in the field of energy procurement and sales, and aims to become theleading energy management service house in the Nordic and Baltic countries.

What is the future of

Nordic-Baltic cooperation?

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Results:

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Looking forwards to

cooperation for economic

development of Baltic states!

Inese Andersone

GatewayBaltic Director

[email protected]

Elizabetes iela 51, Riga, Latvia

Phone: +371 26875782

www.gatewaybaltic.com

nordic investment overview in baltic states

Economy & Finance