State Business Development Company Vake Oy to be transferred to the Ministry of Economic Affairs and Employment and become the Climate Fund (Ilmastorahasto)

The State Business Development Company Vake Oy will be transferred to from the Ownership Steering Department of the Prime Minister’s Office to the Ministry of Economic Affairs and Employment. The transfer will take place as soon as possible, at the latest by the end of this year. The Government discussed the transfer in its budgetary deliberations in September. With the transfer, Vake Oy will become the Climate Fund (Ilmastorahasto).

The Ministry of Employment and the Economy will establish the Climate Fund on the basis of Vake Oy as agreed by the Government in February 2020. After the transfer, Neste Corporation’s 8.31 per cent holding in Vake’s balance sheet will remain with Vake and therefore also be transferred to the Climate Fund. The Prime Minister’s Office will continue to have authority with regard to the entire ownership of Neste Corporation, even though the transfer will result in Neste’s ownership being split between the Prime Minister’s Office and the Climate Fund. The Prime Minister’s Office has 35.96 per cent ownership in Neste Corporation.

The holdings in Altia Corporation, Nordic Morning Group, Posti Group and Vapo Oy on Vake Oy’s balance sheet will be transferred back to the ownership steering of the Prime Minister’s Office before Vake is transferred to the Ministry of Economic Affairs and Employment.

The State Business Development Company Vake Oy was established in 2016 in connection with the Government Resolution on Ownership Policy. The original purpose of Vake and the stages of its development from its establishment until today are described in the timeline at the end of this press release.

Inquiries:
Kimmo Viertola, Director General, [email protected], tel. +358 29 516 0026
Petri Vihervuori, Senior Ministerial Adviser, [email protected], tel. +358 40 487 2623

Timeline of the State Business Development Company Vake Oy, 2016–2020

2016

The Government adopts a Resolution on State Ownership Steering Policy in its plenary session in May 2016. The Government’s new policy seeks to ensure that the corporate assets held by the State are put to more efficient use to boost economic growth and employment. To this end, the Government proposes establishing a development company. In the first phase, the goal is to transfer the state ownership of the following companies to the new development company: Altia Corporation, Arctia Ltd (interests exceeding 50.1 per cent of share capital), Ekokem Oy, Kemijoki Oy, Neste Corporation (interests exceeding 33.4 per cent), Nordic Morning Group, Posti Group (interests exceeding 50.1 per cent), Raskone Ltd and Vapo Oy (interests exceeding 33.4 per cent). 

In the second supplementary budget for 2016 in June 2016, the state is authorised to divest its ownership of Arctia Ltd and Posti Group so that its holding in each company remains at least 50.1 per cent. The state is authorised to relinquish its ownership of Kemijoki Oy in full once the shareholder agreement for the partnership has been signed. 

The State Business Development Company Vake Oy is established in August 2016. The state’s shareholding in Ekokem Corporation is also transferred to Vake in August 2016, and Vake sells its Ekokem shares to Fortum in line with a previous agreement. The sale yields a total revenue of EUR 198 million, of which EUR 100 million is credited to the state as return on capital and EUR 90 million is used to capitalise SoteDigi Oy.

The Government issues guidelines for Vake’s operations in December 2016. According to the guidelines, Vake’s mission is to circulate the capital invested in state-owned companies more effectively and to create value in the companies it owns. The Basic Information Technology Agreement may make investments in business deemed important for the renewal of the business structure and the overall development of society. A further task of the business development company is to provide state-owned companies with an evolutionary path for their renewal and for the development of their ownership structure.

The Government proposes that the lower limit for securing strategic interests be reduced to 33.4 per cent ownership, which would, among other things, make it possible to veto any unwanted amendments to the articles of association. The proposed amendments to the State Shareholdings and Ownership Steering Act are adopted by Parliament in December 2016.

2017

In January 2017, Vake pays EUR 100 million in capital repayment to the state. 

For Neste Corporation and Vapo Oy, the minimum limit for direct state ownership is lowered to 33.4 per cent in the supplementary budget in June 2017.

In August 2017, the Government resolves to establish SoteDigi Oy to develop nationwide customer and patient data systems and other digital solutions for the healthcare and social services sector. The company’s equity of EUR 90 million and other establishment costs are paid out of Vake Oy’s funds, and the shares in SoteDigi Oy are subsequently transferred under the Ministry of Finance’s control and ownership steering.

The Ministerial Committee on Economic Policy discusses increasing the number of members on the Board of Directors of Vake in November 2017, and Reijo Karhinen is elected Chair of the Board of Directors at Vake’s Extraordinary General Meeting. Otherwise, the Board is still composed of public officials.

2018

The situation of the State Business Development Company Vake Oy is discussed by the Ministerial Committee on Economic Policy in January 2018 with regard to the election of the Board of Directors and the current situation in the company, and the Committee requires that a business plan and investment policy be drawn up before the company can begin its operations.

Vake’s Board of Directors is appointed at the General Meeting in March 2018. The Board appoints Taneli Tikka as CEO and he takes up his duties in May 2018. The Board members’ and CEO’s backgrounds are connected to the use of advanced technology, digitalisation, artificial intelligence and entrepreneurship.

In June 2018, the Ministerial Committee on Economic Policy discusses and approves the company’s vision, basic tasks and operational priorities. 

In November 2018, the Ministerial Committee on Economic Policy decides in favour of the launch of Vake’s operations in line with the company’s strategy and approves Vake’s authorisation to carry out the transfers detailed in the Government resolution during the same year.

In December 2018, following the decision of the Government plenary session, the shareholdings of Neste (8.3 per cent), Vapo (16.7 per cent) and Posti (49.9 per cent), along with Nordic Morning Oy’s entire share stock, are transferred to Vake. 

2019

The state’s shareholding in Altia (36.24 per cent) is transferred to Vake in February 2019, following a derogation from the obligation to tender under the Securities Markets Act granted by the Financial Supervisory Authority.

Artificial intelligence is selected as Vake’s first theme. Vake begins preparing its first investments, but none of the ideas that fit the company’s strategy reach the implementation stage before the resignation of Prime Minister Sipilä’s Government. The company begins its project activities related to AI, MyData and the digitalisation of healthcare through a few programmes, but no investments are made by the company. 

The Programme of Prime Minister Rinne’s Government is completed in June 2019. In line with the Government Programme, the role of Vake will be reviewed during autumn 2019 to ensure that it best supports objectives of the Government Programme. The Government Programme declares that the state should use its ownership as a means of creating active renewal in society. The state’s capital assets in corporate ownership are so significant that the assets must be put to more efficient use to boost economic growth and employment. The use of capital is stepped up by means of state ownership steering not only to activate current assets but also to generate new economic activity in Finland. The State Business Development Company Vake Oy has an important role to play in this.

The guidelines approved for Vake in 2016 are discussed by the Ministerial Committee on Economic Policy in June 2019, and the Committee agrees that the guidelines will be applied as such for the time being and that their content will be reassessed as part of the Government Resolution on Ownership Steering Policy.

CEO Taneli Tikka resigns in June 2019, and Paula Laine is appointed as the new CEO in July 2019. 

In July 2019, the Prime Minister’s Office and the Ministry of Economic Affairs and Employment appoint Jouni Hakala to prepare a report on the roles of state investment and development companies. In his report published in September 2019, Hakala proposes structural changes for individual entities to be implemented in three stages. According to the report, Vake should be incorporated into Finnish Industry Investment Ltd and the capital provided to Vake should be returned to the state. Going forward, Vake’s operations should be financed using Finnish Industry Investment’s current capital. 

The proposal for Vake’s new strategy is completed in September 2019 and emphasises digital and climate investments rather than artificial intelligence. The proposal for the new strategy is submitted to Minister Paatero in September. 

However, there is not enough time to make decisions on Vake before the resignation of the Rinne Government in December 2019. The adoption of the Government Resolution on Ownership Steering Policy is also postponed following the resignation the Government.

Prime Minister Sanna Marin’s Government is appointed in December 2019.

2020

Marin’s Government agrees in February 2020 that Finland will establish a climate fund using Vake as its basis. The Prime Minister’s Office sets up an interministerial working group of public officials to develop an operating model for the climate fund. The working group carries out its work during March 2020. 

In April 2020, Vake’s General Meeting appoints a temporary three-person board of public officials to serve without remuneration.

In the budgetary deliberation in September 2020, it is decided that the State Business Development Company Vake Oy will be transferred to the ownership steering of the Ministry of Economic Affairs and Employment. The company’s shareholdings, with the exception of its shares in Neste Corporation (8.31 per cent), will be transferred from Vake’s balance sheet to the ownership steering of the Prime Minister’s Office. The ownership steering of Neste Corporation shares will remain with the Prime Minister’s Office. The Climate Fund (Ilmastorahasto Oy) will be established on the basis of Vake by amending the Articles of Association, and the Ministry of Economic Affairs and Employment will draw up guidelines for the Climate Fund in cooperation with the Prime Minister’s Office, the Ministry of Finance, the Ministry of the Environment and the Ministry of Transport and Communications as a matter of urgency. A new board of directors will be elected for the company, and an investment council will be set up to oversee the company’s financing and investment activities. The investment council will include representatives from the Ministry of Economic Affairs and Employment, the Ministry of Finance, the Prime Minister’s Office, the Ministry of Transport and Communications and the Ministry of the Environment. The company will be provided with EUR 300 million in capital in 2020 and, in addition, it will have a access to annual revenue corresponding to Neste Corporation’s dividends.