NORWAY Law and Practice Contributed by: Karoline Ulleland Hoel, Sigurd Opedal, Ole Henrik Wille and Daniel Nygaard Nyberg, Wikborg Rein Advokatfirma AS
10.2 Drag and Tag Rights Drag and tag rights are typical in equity arrangements in Norwegian private equity deals to facilitate exits. Institutional co-investors and management must usu - ally accept drag mechanisms in the shareholders’ agreement for the relevant investment. The typical drag threshold ranges between 50% and two-thirds of the aggregate equity. In subsequent exits or sales, target shares are typically sold voluntarily, making the actual use of drag rights rare. Institutional co-investors and management are gener - ally granted tag rights if the private equity fund sells its stake in the portfolio company. These tag rights, like drag mechanisms, are included in the relevant share - holders’ agreement and typically have a threshold of 50% or more of the aggregate equity. 10.3 IPO In an IPO exit, the private equity seller typically faces a lock-up period of 6–12 months. It is uncommon for the private equity seller and target to enter into relationship agreements.
other private equity funds dominated in the Nordic countries, to a large extent replacing IPOs. The surge in IPOs during 2020–2021 declined significantly by 2022 and 2023. Comparative data for the first halves of 2025 and 2024 shows a stable IPO trend following the slightly increased activity in 2024, as detailed in 1. Transaction Activity . The 2025 IPO activity remains much lower than the 2020–2021 peak, suggesting that the high activity was a driven by specific market con - ditions, rather than a shift in trends. Typically, exits involve either a “dual track” process – ie, combining an IPO and sale process – or more commonly, a trade sale alone. “Triple track” exit processes have traditionally been less common and if a recapitalisation (or refinanc - ing) is not conducted independently from an exit, it is typically explored once it is determined that there is limited interest in the market. Private equity sellers occasionally reinvest upon exit, particularly if the funds’ initial ownership period was short or if a future significant upside is anticipated. The authors continue to see the increasing trend of investments being rolled over into continuation vehi - cles or later flagship funds in general partner-led transactions.
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