Translation: Original comment published in Finnish on 4/17/2024 at 7:52 am EEST.

Yesterday, Reuters reported a market rumor that Saxo Bank was again exploring strategic options for a change in its ownership structure. The news is not surprising as Saxo has been considering various options over the past few years, e.g., listing via a SPAC. The purpose of the arrangement would be to enable existing financial investors (Sampo and Geely) to exit Saxo. Saxo is still on Sampo's balance sheet for the time being, but Mandatum and Sampo have agreed that Mandatum will acquire Saxo's shares from Sampo once all regulatory approvals have been obtained. There is no material uncertainty as to the consummation of this agreement and the transaction is expected to close relatively soon.

According to Reuters market rumors, Saxo would be valued at 1.5-2.0 BNEUR, which would put the value of Mandatum's stake at 300-400 MEUR. At the end of 2023, the book value used by Mandatum and Sampo for Saxo was just over 300 MEUR. Mandatum itself has openly stated that it wishes to dispose of Saxo as quickly as possible and it would be very positive if Mandatum were to proceed with the sale. Saxo is too large an investment for Mandatum, and in addition to the high investment risk, it ties up a significant amount of solvency capital. When Saxo is finally divested, Mandatum's balance sheet and solvency will be significantly strengthened, giving it clear room for maneuver both in terms of M&A and possible return of excess capital. In our opinion, a quick exit timetable would be more important for Mandatum in the Saxo case than squeezing the last million out of the sale price. We have covered Saxo and its future sale in our Mandatum research and therefore the news has no impact on our view of Mandatum.