SWEDEN Trends and Developments Contributed by: Manne Bergnéhr, Ingela Sundelin and Arvid Sundelin, Hellström Law Firm
Hellström Advokatbyrå KB Kungsgatan 33 Box 7305 103 90 Stockholm Sweden Tel: +46 707 16 30 24 Email: manne.bergnehr@hellstromlaw.com Web: www.hellstromlaw.com
Executive Summary Sweden’s energy and infrastructure M&A market is entering a new cycle. Electrification of heavy indus- try, data centre build-out, and transport decarbonisa- tion are driving grid investment needs. At the same time, policy changes, notably the new FDI screening regime, military-related stop to offshore wind farms and reopening for new nuclear, are reshaping risk allo- cation and valuations. Ongoing M&A trends such as consolidation in service and construction industries related to electrification and grid build-out and small and mid-sized hydropow- er plants and companies are expected to continue; M&A and joint-venture building in nuclear is also an expected trend. Funds and companies active in offshore and onshore wind, solar and battery energy storage systems have remained in a “waiting mode” but an uptick in invest- ments and M&A activity is expected in 2026. Maintenance investments in rail, water and sewer sys- tems, and certain security-related infrastructure pro- jects are also expected to drive M&A activities and consolidation in adjacent industries for services and specialised construction. Market and Political Landscape Macroeconomic backdrop and power balance Sweden combines comparatively strong public financ- es and a deep institutional investor base with one of Europe’s cleanest power mixes (eg, hydro, nuclear and wind). Power demand is set to grow materially through 2035–45 (electrification of steel, chemicals,
transport, and the rise of AI/data centres). Develop- ers and acquirers are struggling in contending with imbalances and capacity constraints in the southern price areas and a grid connection queue that influ- ences project timelines and pricing. Wind generation has grown rapidly and has, on windy months, rivalled or exceeded monthly output from nuclear and hydro. The government’s energy policy now targets a “fossil free” system, explicitly including nuclear, with a long-term ambition to double electricity output over the next two decades. Bottlenecks in grid build-out and permitting still drive variances across Nord Pool price areas. Policy Matters Relevant to M&A FDI screening Since 1 December 2023, Sweden operates a com- prehensive screening regime for foreign direct invest- ments in “protection worthy” activities (energy, trans- mission, certain digital infrastructure, water, transport and other critical functions). Notifications are broadly framed and can capture minority deals, internal reor- ganisations and asset deals. For energy and infra- structure transactions, this is now affecting time but also the investor landscape, notably Chinese inves- tors. Nuclear reopening A comprehensive support package including govern- ment loans and two-way Contracts for Difference (CfD) has been introduced. Proposed legislative changes are seeking to remove the historic location cap and enable newbuild reactors at additional coastal sites, including potential small modular reactors (SMRs).
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