2025 Activity

The general M&A deal activity in Norway remained resilient throughout 2025 and once again reached record levels. According to Mergermarket data, close to 1,400 transactions were recorded. Despite challenging geopolitical backdrop, including ongoing US tariff disputes, the Russia–Ukraine war, the Iran war and heightened tensions in the Middle East generally, deal activity remained strong across all four quarters, each recording deal counts well above 300, with the second quarter proving the most active.

The technology (22.4%) and industrials (21.7%) sectors once again dominated by deal count, together accounting for close to half of all transactions, followed by business services (14.3%) and energy and natural resources (12%). By value, energy and natural resources led with approximately 25% of total disclosed transaction value, followed by industrials (16%) and real estate (15.6%). Cross-border transactions represented approximately 55% of activity, with Sweden the single largest source of inbound acquirers.

Private equity-sponsored transactions accounted for around one-third of total deal count, with Business Services the only sector over-represented with more PE- or financial-sponsor-backed transactions.

2026 Activity

Norwegian M&A activity moderated somewhat in the first half of 2026, with approximately 600 transactions recorded compared to 700 in H1 2025 (subject to upward revision as reporting lag is accounted for), though activity levels remained healthy by historical standards.

By sector, industrials (24.1%) overtook technology (22.5%) as the most active sector by deal count for the first time in recent years, while business services (14.4%) and energy and natural resources (10.3%) maintained their positions. By value, technology dominated at approximately 40% of total disclosed deal value. Energy and natural resources ranked second at 20%, with communications, media and entertainment third at 13.3%.

The strategic-versus-sponsor split remained stable at approximately 66% and 34%, respectively, consistent with 2025, with business services again the sector most dominated by PE- or financial sponsor-backed transactions. Cross-border transactions edged up to approximately 56% of activity.

As outlined in 1.1 Private Equity Transactions and M&A Deals in General, the Norwegian M&A market has remained notably stable over the past year, showing resilience and less volatility than the macroeconomic backdrop might suggest. With Norges Bank maintaining a restrictive monetary policy stance through the period – and raising rates further in 2026 – financing conditions for leveraged transactions have remained more demanding than in the low-rate years, with sponsors adapting through lower leverage ratios and greater equity contributions. Overall activity levels have nonetheless held up, driven by a well-capitalised private equity sector and significant levels of dry powder.

A particularly pronounced consolidation trend has emerged within the industrials sector, centred on electrical contractors and plumbing, heating, ventilation and air-conditioning (HVAC) businesses, making them amongst the most actively traded sub-sectors in the Norwegian market. The transactions are predominantly small, privately negotiated bolt-on acquisitions executed by a handful of Norwegian and Nordic platform businesses pursuing clear buy-and-build strategies.

Although traditional oil and gas transaction volumes have moderated, shifts in European energy security priorities have maintained investor attention on the Norwegian continental shelf. An increasingly prominent theme has been the defence and security sector, where investment in defence technology, cybersecurity and autonomous systems has accelerated, reflecting heightened geopolitical tensions and increased NATO and national defence spending. Data centres and digital infrastructure have also emerged as an active area for private equity and infrastructure investment, supported by Norway’s renewable energy resources and favourable climate conditions, with several significant transactions recorded in the past 12 months.

Fundraising conditions have remained selective, with limited partners prioritising managers with demonstrated track records and clear value creation strategies. Norwegian institutional investors – including pension funds and life insurance companies – remain active allocators to private equity, though primarily to larger and more established managers.

Exit activity has remained constrained, consistent with the global private equity market’s record backlog of unrealised assets. Valuation gaps between buyers and sellers have persisted, and with Norges Bank maintaining a restrictive monetary policy stance, private equity firms have increasingly shifted focus toward operational value creation, buy-side consolidation, and alternative liquidity strategies.

Continuation vehicles have become a relatively established feature of the Norwegian private equity market, allowing managers to retain high-performing assets and provide liquidity to existing limited partners outside a traditional exit process. A growing number of Norwegian fund managers have launched or are actively exploring continuation vehicles in recent years, signalling growing maturity in the Norwegian GP-led secondary market.

Ownership of a Bank or Life Insurance Company

Norway has a longstanding administrative practice restricting any single shareholder from owning more than 20–25% of a Norwegian bank or life insurance company (or financial groups comprising such entities), unless the shareholder is a financial institution.

On 11 July 2024, the EFTA Surveillance Authority (ESA) referred Norway to the EFTA (European Free Trade Association) Court, arguing that the ownership ceiling practice violates the EEA Agreement. Following an oral hearing in April 2025, the EFTA Court delivered its ruling on 30 September 2025, finding that Norway’s administrative practice is contrary to EEA law. The judgment opens the door to greater private equity ownership in Norwegian financial institutions, subject to individual regulatory suitability assessments.

On 24 June 2026, the FSAN published a consultation paper proposing to abolish the longstanding restriction on acquisitions of qualified holdings exceeding 25% in Norwegian banks and insurance undertakings.

Withholding Tax on Liquidation Proceeds for Foreign Shareholders

Under the current Norwegian tax regime, liquidation proceeds distributed from a Norwegian entity are not taxable for foreign shareholders (unless the shares are owned as part of a taxable business in Norway). A government-appointed expert committee has proposed introducing withholding tax on liquidation proceeds to foreign shareholders, albeit it remains uncertain if and when such rules will be introduced. If introduced, they will affect the level of taxation when exiting investments in Norway through liquidation, although certain exemptions are expected for corporate shareholders resident in the EEA.

EU Directives and Regulations

To comply with its obligations under the EEA Agreement, Norway must adopt and implement certain EU Directives and Regulations.

To address the shortcomings of ELTIF 1.0, “ELTIF 2.0” was adopted by the EU in January 2024, which entered into force in Norway on 1 April 2026. ELTIF 2.0 introduces changes aimed at making ELTIFs more commercially viable, particularly by easing requirements for fund managers marketing ELTIFs only to professionals, broadening eligible investment assets, and facilitating access for non-professional investors.

AIFMD II entered into force in the EU in April 2024, significantly expanding AIFMD I – most notably by introducing a dedicated framework for loan-originating funds. Once implemented in Norway, this may open the market to direct lending funds, which are currently restricted by Norway’s banking monopoly. The Ministry of Finance submitted a consultation paper from the FSAN on 8 October 2025, but Norway did not implement AIFMD II within the EU transposition deadline of 16 April 2026. A formal legislative proposal may still be expected in the second half of 2026 or early 2027, subject to parliamentary and ministerial priorities.

In April 2024, the European Parliament adopted the EU Listing Act, amending the EU Prospectus Regulation, the EU Market Abuse Regulation and Directive and MiFID II and MiFIR. In February 2025, the Ministry of Finance proposed regulations transposing the amendments to the Prospectus Regulation and the Market Abuse Regulation in Norway. The Listing Act has not yet been implemented in Norway. However, in June 2026, the Ministry of Finance published a proposal for a bill to amend Norwegian legislation for the future implementation of the Listing Act in Norway. The timeline for implementation remains uncertain.

Regulation (EU) 2019/2033 and Directive (EU) 2019/2034 (IFR/IFD) establish a dedicated regulatory capital framework for investment firms, replacing the bank-based capital requirements previously applicable to such firms – including alternative investment fund managers – with more proportionate rules. IFR/IFD were included in the EEA Agreement on 14 March 2025, and in June 2025, the Ministry of Finance proposed a bill for the implementation in Norway, which was adopted by Parliament in February 2026. Entry into force in Norway remains conditional upon Iceland lifting its constitutional reservation, which, if completed on schedule, is expected in the course of 2026.

The EU AML package – comprising the single rulebook (EU) 2024/1624, the Sixth Anti-Money Laundering Directive and the regulation establishing a new EU-level AML supervisory authority (AMLA) – will apply from July 2027. For private equity, the key development is the expansion of obliged entities: financial holding companies with indirect interests in regulated entities may become subject to AML obligations for the first time. The package also introduces group-wide compliance requirements for PE-backed groups, and a new multiplicative approach to beneficial ownership may require re-assessment across ownership structures. In Norway, authorities aim for entry into force in July 2027, though EEA incorporation may cause delays.

General

Most Norwegian private equity transactions involve limited companies. Thus, the main company-specific acts that regulate M&A transactions are the Private Limited Companies Act and the Public Limited Companies Act. Depending on the deal in question, other general legislation supplements the aforementioned, mainly the Contracts Act, the Sale of Goods Act, the Accounting Act, the Taxation Act, the Employment Act and the Competition Act.

Listed Targets

The regulatory framework differs significantly for listed and non-listed targets. In respect of non-listed targets, the parties are largely free to agree on the terms of the sale and transaction agreements. For targets listed on the regulated markets (Euronext Oslo Børs and Euronext Expand), the Securities Trading Act and the Securities Trading Regulations (supplemented by rules and guidelines issued by Euronext Oslo Børs) provide a comprehensive and mandatory set of rules. These rules do not apply to targets listed on Euronext Growth (non-regulated market), yet market practice suggests that such acquisitions to a large extent are structured similarly to acquisitions of listed targets, despite no equivalent set of mandatory regulations.

Norway has implemented, although not always in their latest amended versions, inter alia, the EU Prospectus Regulation, the Market Abuse Regulation, the Markets in Financial Instruments Directive, the Markets in Financial Instruments Regulation, the Takeover Directive and the Transparency Directive. These rules include, inter alia, prospectus disclosure, market conduct and takeover-related obligations that dictate the sales process for companies listed on regulated markets; see 7. Takeovers. Simplified prospectus rules and amendments to, in particular, the Market Abuse Regulation and the EU Prospectus Regulation have been introduced in the EU through the EU Listing Act. The corresponding amendments have not yet been implemented in Norway, but are expected to be implemented in 2026.

AIF

Norway has implemented the AIFMD through the Norwegian AIF Act. The AIF Act applies to managers (AIFMs) of alternative investment funds (AIFs). Private equity funds generally fall under this definition. Generally, AIFMs are required to be authorised by the FSAN. However, certain exemptions apply to sub-threshold AIFMs, which may register with the FSAN and only be subject to AML requirements and certain disclosure obligations. To qualify as a sub-threshold AIFM, the AIFM cannot manage AIFs with aggregated assets under management equal to or exceeding an amount equivalent in NOK to:

• EUR500 million, when the portfolios comprise unleveraged AIFs with no redemption rights exercisable during a five-year period following the first investment in each fund; or
• EUR100 million, for AIFs other than those mentioned above.

Sub-threshold AIFMs cannot market their funds to retail investors in Norway, nor passport their services into other EEA member states.

The FSAN supervises authorised and registered AIFMs in Norway.

Acquisition of Control

Notification requirements apply to the acquisition of control of listed and non-listed companies of a certain size. Additionally, if a private equity fund’s voting share of non-listed companies reaches, exceeds or falls below 10%, 20%, 30%, 50% or 75%, the fund manager must notify the FSAN promptly (at the latest within ten business days).

Private equity funds are also subject to the asset stripping provisions under the AIF Act, limiting distributions, capital reductions, share redemptions and acquisition of own shares by EU-incorporated portfolio companies during the first two years following acquisition of control by an AIF, individually or jointly together with other AIFs.

Non-EU funds marketing into any EU/EEA member state under national private placement rules are equally subject to these provisions.

Merger Control

In accordance with Norwegian merger regulations, companies must notify the Norwegian Competition Authority (NCA) of concentrations where the combined Norwegian annual turnover of the undertakings concerned exceeds NOK1 billion and at least two of the undertakings concerned have an annual Norwegian turnover exceeding NOK100 million.

Transactions triggering a notification cannot be closed until they have received clearance from the NCA.

The NCA may also, within three months of a final agreement/acquisition of control, call in for review transactions falling below the turnover thresholds if the NCA has reason to assume that competition will be affected. It is also possible to voluntarily notify the NCA of a transaction, although this is rarely done.

No notification is required to the NCA if the parties meet the thresholds for a mandatory notification to the European Commission under the EU Merger Regulation, or if they need to make a notification to the EFTA Surveillance Authority.

A government-appointed committee proposed amendments to the Competition Act in December 2025, covering primarily procedural aspects of merger control. A public consultation concluded in March 2026, and legislative amendments are not expected before 2027.

Foreign Direct Investment

Under the Norwegian Security Act (SA), entities designated by formal decision as handling and controlling information, information systems, objects or infrastructure of vital importance to fundamental national functions, and/or engaging in activities that are of vital importance to such functions are subject to notification requirements. An acquirer of at least one-third of the shares in a designated entity must notify the relevant ministry or National Security Authority. There is no public register of designated entities, making this a standard due diligence check in Norwegian private equity transactions.

Norwegian FDI rules do not formally distinguish between private equity buyers and sovereign wealth investors, or funds with sovereign wealth co-investors. However, the identity and ultimate ownership of the acquirer – including the nature of any public-sector co-investors – is a relevant consideration in the ministry’s assessment, and sponsors with state-linked backers have in practice been subject to additional scrutiny.

A number of changes to the SA have been passed, but are not yet in force, including a standstill obligation, preventing the closing of an acquisition until the relevant ministry has provided its approval, and a lowering of the notification threshold to 10%, with recurring filing obligations at one-third, 50%, two-thirds and 90%. Further reform proposals are expected to bring a substantially broader set of transactions within scope.

The EU Foreign Subsidies Regulation

The EU Foreign Subsidies Regulation does not apply to purely Norwegian transactions, unless the target also operates in EU. The relevant thresholds are that:

• the acquired company, one of the merging parties, or the joint venture must generate turnover (on group level) in the EU of at least EUR500 million; and
• the parties to the transaction must have been granted combined aggregate foreign financial contributions of at least EUR50 million over the past three years.

The European Commission takes the view that foreign contributions received from the Norwegian government are relevant for determining whether the latter threshold is met. Where the thresholds are met, notification must be made to the Commission. The Foreign Subsidies Regulation has been relevant in large-scale Norwegian transactions since coming into force, for example, Permira’s and Blackstone’s offer for the outstanding shares in Adevinta.

Anti-Bribery, Sanctions and ESG

The regulatory landscape remains shaped by the sanctions imposed on Russia and Russian nationals by Norway, the EU, the UK and the USA and by Russian countermeasures. Regulators have maintained a continued focus on circumvention risks, and the surge of measures and countermeasures keeps sanctions and export control issues prominent in due diligence. International operators must pay close attention to divergences across Western sanction regimes – including in jurisdictions that have traditionally maintained aligned policies – and to growing geopolitical unrest in the Middle East, including the Iran war.

On the anti-bribery and corruption front, a significant development came into force in June 2026: Økokrim (Norway’s National Authority for Investigation and Prosecution of Economic and Environmental Crime) published new guidelines on corporate penalties in international corruption cases. The guidelines apply to the imposition of corporate fines in corruption cases covered by the OECD Convention, but may also provide guidance in other economic and environmental crime cases. For the business sector, the guidelines offer greater predictability on penalty levels and are designed to strengthen incentives for prevention through structured compliance work, self-reporting and active co-operation with authorities.

The Norwegian Transparency Act, which entered into force in July 2022, continues to apply, but is pending possible revision following the adoption of the EU Corporate Sustainability Due Diligence Directive (CSDDD) in July 2024, which has not yet been transposed into Norwegian law.

So far in 2026, the Norwegian Consumer Authority has imposed one administrative fine against a company for breach of the duty of disclosure under the Transparency Act.

In February 2025, the European Commission proposed the Omnibus package – a set of amendments aimed at simplifying EU sustainability requirements – which includes revisions to the CSDDD and the Corporate Sustainability Reporting Directive (CSRD). The CSRD, implemented in Norway through the Accounting Act, requires companies to report on their ESG performance. The package comprises two directives. The Stop-the-Clock Directive, adopted in the EU in April 2025 and implemented in Norway in July 2025, postpones reporting obligations by two years for companies originally due to report for financial years 2025 or 2026. The Omnibus I Directive, which entered into force in the EU in March 2026, significantly narrows the scope of both the CSRD and the CSDDD and simplifies reporting requirements. The Norwegian government has proposed implementing changes to the CSRD through amendments to the Accounting Act, and has indicated that it will seek to follow the EU implementation timeline. Implementation of changes to the CSDDD is a separate process, as the CSDDD has not yet been incorporated into the EEA Agreement.

In the Norwegian market, buy-side due diligence is typically red flag focused. In structured sales processes, where sell-side requests vendor due diligence (VDD), a more detailed VDD is often conducted, particularly regarding financials.

Due diligence is normally conducted by a legal, financial and tax team. Sometimes, separate teams are engaged for other key areas depending on the transaction, and the authors are seeing increasing use of ESG due diligence advisers. Other than business-specific issues, key areas of focus for legal due diligence in private equity transactions include:

• corporate;
• GDPR;
• anti-trust;
• anti-corruption;
• environmental, social and governance (ESG); and
• regulatory matters.

There has been an increase in focus on tax, ESG, anti-corruption, and trade sanctions for target groups operating in high-risk jurisdictions, in particular due to ongoing US trade policy uncertainty and related tariff measures, and the Russia–Ukraine war and related sanctions.

AI tools are being integrated as a complement to legal advisers in due diligence processes, with general AI tools now actively applied in Norwegian legal and due diligence work. Due diligence-specific AI solutions remain in a trial phase, with some challenges limiting full implementation (eg, legal complexity, language and nuance). The authors expect dedicated AI solutions to become more integrated in Norwegian due diligence processes, while remaining complementary to legal advisers rather than fully replacing them, considering the risks inherent in the use of AI tools, especially for regulated industries.

VDD is common for private equity sellers in structured sales processes. Conducting a VDD helps in identifying and addressing any material findings before the transaction commences. Presenting a VDD report to potential bidders gives them detailed information early, enabling informed offers within tight timeframes and providing some level of comfort related to the target’s business.

In Norway, VDD reports typically take the form of traditional issue-based reports or more descriptive fact books of the target group. Such reports are normally provided by sell-side legal advisers in structured sales processes.

When VDD reports are available, advisers often rely on them and conduct buy-side due diligence on a confirmatory or “top-up” basis (ie, to verify or further explore the VDD findings).

The final buyer and finance provider are often offered VDD reports for reliance.

Private equity funds in Norway typically acquire companies through share purchase agreements as well as shareholder agreements applicable to joint investments by the fund, any co-investors, and management shareholders. Prior to negotiating long forms, the parties typically enter into a term sheet and non-disclosure agreement.

Compared to auction sales, the terms of the acquisition in privately negotiated transactions are generally quite similar. In auction sales, the transaction agreement typically contains fewer conditions precedent as bidders will use this as a tool to make their bid more appealing to the sellers.

In public deals, transaction risk is often reduced by obtaining pre-acceptances from material shareholders and members of management and the board holding target shares prior to the public launch of the offer. In friendly takeovers in the Norwegian market, it is also customary for the bidder and the target to enter into a process agreement governing the pre-announcement process leading up to the signing of a transaction agreement and the public launch of the offer, including the circumstances and conditions for announcing the offer.

A transaction agreement entered into by the bidder and the target board, setting out the terms and conditions for the offer, is the norm for friendly takeovers in the Norwegian market. Such agreements typically provide that the board will recommend that the target’s shareholders accept the offer. Close to 84% of all voluntary tender offers approved by the relevant Norwegian takeover supervisory authority from 2008 to July 2026 (completed and uncompleted) were made on the basis of a board recommendation. If the bidder is unable to achieve 100% control through a voluntary tender offer, the bidder may, on certain conditions, opt for a squeeze-out; see 7.6 Acquiring Less Than 100%.

In Norwegian acquisitions the private equity-backed buyer entity (acquisition vehicle) is almost exclusively structured as a Norwegian private limited company (aksjeselskap), set up as a single purpose vehicle (SPV) for the transaction (BidCo). Foreign funds and managers frequently invest in the BidCo through a separate holding structure in, for example, Luxembourg or the UK.

Depending, inter alia, on the transaction financing model and other commercial factors, the Norwegian acquisition structure usually consists of either only BidCo or also a set of holding companies (MidCo and/or TopCo).

The choice of acquisition structure is usually determined by which structure allows for the most efficient return on investment upon exit, taking into account tax efficiency (including deductibility of interest, withholding tax, VAT and thin capitalisation rules), financing, governance, co-investors, risk exposure, corporate liability, disclosure concerns and regulatory requirements. Where external financing is obtained, a structure providing a single point of enforcement of the pledge of shares in BidCo (eg, a BidCo/MidCo/TopCo structure) is typically applied.

The private equity fund itself is rarely involved in the transaction documentation (save for execution of equity commitment letters confirming that the BidCo structure will receive the necessary funding). The designated investment team and in-house legal counsel of the fund manager are typically involved in the initial stages of negotiation, with outside legal counsel leading the process and bearing the primary workload on larger deals and add-on acquisitions.

General Trends

In Norway, private equity deals are normally financed by a combination of third-party debt financing and equity, with the equity portion increasing in recent years, particularly in highly leveraged deals. The proportion of debt varies based on factors such as the fund’s track record, deal size and robustness, the credit risk, business sector, relationship with debt providers, and the target group’s future prospects of creating revenues, profits and debt service capacity. Generally, initial leverage rarely exceeds 40–50% in the current market.

Additionally, bond issues and direct lending have become more prominent in the capital structure (either replacing bank debt or in pari passu or super-senior structures). This shift is driven by increased awareness among domestic and foreign investors of the benefits of the Norwegian bond market and the structuring of direct lending within a Norwegian legal framework.

Leveraged Buyouts

In leveraged buyouts, debt financing is generally provided to the acquiring entity (BidCo) to finance the acquisition, and sometimes also to the target group to refinance existing debt and finance general corporate or working capital requirements. Typically, debt providers will not accept co-investors or management investing directly in BidCo due to their requirement for a single point of enforcement in connection with a pledge of shares in BidCo, which is one of the reasons why there is usually a holding company above BidCo.

Acquisition Debt

Term loans, unitranche and bonds are commonly used to finance acquisition debt as well as refinance the target group’s existing debt. Generally, the group’s working capital and corporate financing requirements are met through working capital facilities, such as revolving credit or overdraft facilities, which are often structured as super senior debt. Any sponsor equity financing is often structured as equity and/or subordinated debt.

Provision of Funds

A private limited company may, under certain conditions, provide funds, guarantees or security for acquiring its own shares or shares in the company’s direct or indirect parent company.

Thus, both the BidCo’s acquisition debt and the target group’s refinancing debt can be secured by pledging the BidCo’s shares and its shares in the target, along with guarantees and security from the target group.

Banks and other lenders now require fewer financial covenants, though they remain more extensive in Norway than in, for example, the London market. The leverage ratio covenant is almost always required, often supplemented by either the interest cover ratio covenant, cash-flow cover ratio covenant or an equity-based covenant – while the capital expenditure (capex) covenant is rare.

Lenders show greater flexibility on other covenants, like acquisition restrictions and asset sales, but are still stricter than the London market. Bond issues often include incurrence covenants and the most used covenant in these tests is the leverage ratio covenant, but the authors are now also seeing an increasing presence of financial maintenance covenants, in the form of leverage ratio or minimum liquidity covenants.

It is not uncommon for sellers to require an equity commitment letter to provide contractual certainty for the equity-funded portion of the purchase price from a private equity-backed buyer. Similarly, to avoid any financing conditions and ensure debt funding certainty, private equity funds frequently obtain debt commitment letters from underwriters on a “certain funds” basis before bidding or signing acquisition agreements.

In most Norwegian private equity deals, the fund holds a majority stake. Acquiring minority stakes in listed companies has occasionally occurred in recent years, but it remains rare.

Club deals involving a consortium of private equity sponsors are rare in Norway, largely because deal value does not necessitate risk distribution across other private equity funds – a strategy often used to avoid exceeding investment concentration limits or similar restrictions.

Co-investments alongside the lead fund are, however, quite common. Co-investors are typically existing limited partners of the fund, although external co-investors are also seen, particularly in larger transactions. These investments are usually passive, with no direct involvement from the co-investors in the portfolio companies.

Transactions involving both a private equity fund and a corporate or industrial co-investor do occur, as illustrated by the Volue transaction (see 7.1 Public-to-Private), though such structures remain relatively uncommon in the Norwegian market.

Primary Consideration Structures

Locked-box accounts are the predominant consideration structure in Norwegian private equity transactions. In auction processes, locked-box accounts are by far the most common, as they simplify bid comparisons for sellers. These accounts are usually audited (at least partially) and typically covered by a warranty.

Completion account mechanisms are also used, where the preliminary purchase price is based on an estimate of the completion account’s balance sheet, and subject to a “true-up” adjustment post-transaction to reflect the final agreed values. The final completion accounts are rarely audited.

A fixed purchase price is sometimes applied. Deferred considerations such as earn-outs are commonly offered by private equity-backed buyers, unlike private equity-backed sellers, who require a clean exit. Earn-outs are sometimes used to bridge gaps in purchase price negotiations. A private equity-backed buyer may, more often than industrial buyers, offer earn-out or other forms of deferred consideration, especially when investing in start-ups (or other companies where valuations are based on future earnings). They will often require selling management members to re-invest a substantial portion of their proceeds, settled via sellers’ credits rather than cash. Security for deferred consideration is rarely provided by private equity-backed buyers, although certain operational undertakings related to earn-outs may be negotiated.

Leakage Provisions

Whenever locked box accounts are applied, leakage provisions are usually also included, regardless of whether the seller is backed by a private equity firm (although leakage provisions may be more refined in private equity deals).

In a completion account mechanism, the post-transaction “true-up” adjustment will adjust for relevant leakage.

Locked-box consideration structures are commonly used in Norwegian private equity transactions. Interest on the locked-box amount is normally applied and is particularly common in auction processes, usually in the range between 2–5%, depending on, inter alia, the expected cash flow of the target group in the relevant period.

Leakage occurring during the locked-box period is usually not charged with interest.

Separate dispute resolution mechanisms for locked-box consideration structures are not common. For completion accounts structures, a separate dispute resolution mechanism is almost always used to resolve disagreements.

In private equity transactions, conditions precedent relating to regulatory approvals, such as no intervention by the NCA or FDI, are always included (if relevant). Other typical conditions precedent include:

• no material breach occurring in the period between signing and closing; and
• due diligence-specific findings, such as key third-party consents.

Material adverse change clauses (MACs) are sometimes included in private deals, but their use has declined significantly in recent years. In public takeovers, MACs are usually included; in the period 2008 to July 2026, 88 out of 105 voluntary offer documents approved by the Norwegian takeover supervisory authority contained a MAC.

Transaction agreements for W&I-insured deals not subject to an auction process sometimes include a right for the buyer to terminate the agreement if new circumstances arise during the period between signing and closing which are not covered by the W&I insurance, unless the seller compensates the buyer for any downside.

It is highly unusual for private equity-backed buyers to accept “hell or high water” undertakings to assume all of the antitrust or other regulatory risks related to the completion of the transaction. Typically, the buyer can walk away from the transaction if merger control approval, FSR or FDI clearance is not obtained.

In conditional deals with a private equity-backed buyer, a break fee in favour of the seller is uncommon. For public deals, out of 105 voluntary offer documents approved by the Norwegian takeover supervisory authority in the period from 2008 to July 2026, 63 involved a transaction agreement, of which at least 32 contained provisions for break fees.

There are no specific legal limits on break fees if applied to the sellers in private and public deals. However, Norwegian company law is not entirely clear as to the extent to which the target can pay a break fee. According to the Norwegian Corporate Governance Code – particularly relevant for listed companies – the target should be cautious of undertaking break-fee liabilities, and any fee should not exceed the costs incurred by the bidder. The market level of break fees is usually in the range of 0.8% to 2% of the transaction value.

Norwegian private equity deals rarely use reverse break fees.

In private equity deals, the acquisition agreement can be terminated if conditions precedent are not met or waived within the agreed long-stop date. Termination rights are otherwise limited, with certain exceptions under Norwegian background law for cases like fraud, gross negligence or wilful misconduct, which are highly unusual.

Long stop dates vary, but typically reflect the expected time for obtaining regulatory approvals, plus a buffer of one to several months.

In Norwegian private equity transactions, a private equity-backed seller (or buyer) is hesitant to accept any deal risk and usually requires a clean exit. Such a seller usually opposes accepting indemnities. To mitigate risk the warranty catalogue is usually covered under W&I insurance. If the deal is not insured, which is rare for private equity-backed sellers, they generally only offer fundamental warranties. In contrast, industrial sellers tend to provide more comprehensive warranties, regardless of insurance coverage. In auction processes, the number of conditions precedent is usually limited to no material breach, regulatory approvals and necessary third-party consents.

The main limitations on liability for the seller are linked to the buyer’s knowledge, financial thresholds (basket, de minimis and total cap) and time limitations; see 6.9 Warranty and Indemnity Protection.

With W&I insurance becoming the norm in private equity deals, warranties provided by private equity-backed sellers are usually comprehensive. This does not significantly differ where the buyer is also private equity-backed.

The following are the customary financial limits on warranty liability.

• De minimis: 0.1–0.2%.
• Basket: 1–2% of purchase price.
• Total cap: 10–30% of purchase price.

In W&I-insured deals, the de minimis threshold is usually closer to 0.1%, and the basket closer to 1%. A private equity-backed seller will usually not accept a total cap of more than 10–15% unless the deal is W&I-insured; in this case, no recourse against the seller will apply.

The following are the customary time limits on warranty liability.

• General limitation period – between 12 and 18 months (24 months in case of W&I insurance).
• Tax warranty limitation period – five years (seven years in case of W&I insurance).
• Fundamental warranties – three to five years.

Management co-investors are usually obligated under the existing shareholders’ agreement to provide the same warranties as the fund (usually the same liability limitations as set out above).

Full disclosure of the data room is typically allowed against the warranties, meaning that the buyer is considered to have knowledge of information presented fairly in the provided information. Exceptions are often accepted for fundamental warranties.

The following protections are typically included in acquisition documentation:

• pre-completion undertakings by the sell-side to secure continuation of the operation of the target group in accordance with past practice and to forbid share issues and similar between signing and closing; and
• post-completion obligations such as non-compete and non-solicitation undertakings – however, private equity-backed sellers very rarely accept non-compete or non-solicit undertakings.

To secure clean exits, private equity-backed sellers typically avoid providing indemnities to buyers. Management co-investors and non-private equity sellers may sometimes provide indemnities, but they are typically treated similarly to private equity sellers.

W&I insurance is very common in private equity deals, with approximately 70% of the insured deals involving private equity players. W&I insurance is becoming increasingly popular for industrial players too.

For public deals, W&I insurance brokers report an increased use of W&I insurance where warranties are provided.

Escrow arrangements are rare in the Norwegian private equity market. Private equity sellers prefer a clean exit, and W&I insurance has become the primary mechanism for achieving this – displacing the need for escrow or retention arrangements.

Litigation is not a common outcome of Norwegian private equity transactions. The most common cause for litigation is a breach of warranty.

With the rise in W&I insurance claims, the authors are seeing an increase in disputes related to completion accounts. These are often resolved outside of court through settlement agreements or expert decisions.

The majority of public-to-private transactions in Norway are completed by industrial buyers. Private equity-backed public-to-private transactions are less frequent, but the market has seen a number of notable examples, such as the acquisition of Adevinta by a bidder consortium comprising, inter alia, Permira and Blackstone (2024), Advent, Generation and Arendals Fossekompani’s acquisition of Volue ASA (2024), and KKR’s acquisition of Quantafuel (2023).

Once a target listed on a regulated market is made aware that an offer (mandatory or voluntary) for the shares will be made, the target’s board and CEO become subject to certain corporate action restrictions, and the board is required to make a statement with respect to the offer and its consequences for the target’s shareholders.

A transaction agreement is often entered into between the target’s board and the bidder in a friendly process. Such agreements are also common in deals involving Euronext Growth-listed targets.

Stakeholders in Norwegian companies listed on a regulated market are subject to disclosure obligations to the issuer and Euronext Oslo Børs if the proportion of shares and/or right to shares of a person or entity reaches, exceeds or falls below any of the following thresholds: 5%, 10%, 15%, 20%, 25%, one-third, 50%, two-thirds and 90% of the total issued share capital or voting rights of the listed company. The disclosure obligation also applies to equity certificates and depositary receipts (if Norway is the home member state of the issuer), entitlements to acquire shares, and financial instruments with similar economic effect as shares.

For non-Norwegian companies listed on a regulated market in Norway, the thresholds are determined in accordance with the applicable law in the respective company’s country of incorporation.

If a person, through acquisition, becomes the owner of more than one-third of the voting rights of a Norwegian company listed on a Norwegian-regulated market, the person is obligated to bid on the remaining shares (with repeat triggers at 40% and 50% of the voting rights for shareholders who continue to acquire beyond the initial threshold). The threshold is calculated on a consolidated basis with the respective shareholders’ closely associated parties (may include target shares held by affiliated or related funds or portfolio companies).

For non-Norwegian companies with a registered office within another EEA country admitted to trading on a Norwegian regulated market, the threshold depends on the laws of the country of incorporation of the company.

The most common form of consideration in Norwegian takeovers is cash. It is estimated that approximately 80% of completed voluntary offers are cash offers, while the remaining 20% comprise shares or a mix of shares and cash. Securities such as convertible bonds, warrants, and similar instruments are also permitted, but are rarely offered. The authors do see takeovers that include a roll-over structure, which may be available if agreed outside the offer (prior to entering into the transaction agreement) and the voluntary offer reflects the financial value of the consideration agreed outside the offer.

Mandatory offers must at minimum equal the highest price paid in the previous six months. Mandatory offers require a full cash consideration option. However, shares or other securities may constitute alternative consideration.

The most successful takeover offers in Norway are structured as a friendly offer where the bidder and the target board enter into a transaction agreement. Out of 105 voluntary tender offers between 2008 and July 2026, 88 offers (both completed and non-completed) were recommended by the target board, of which 63 involved a transaction agreement.

Norwegian takeover regulations allow for a wide range of completion conditions in voluntary takeover offers, such as those relating to financing and due diligence, although such conditions are unlikely to be accepted by the target’s board and key shareholders. Mandatory offers must be unconditional.

Common conditions for launching the offer, typically for the bidder’s benefit, include obtaining pre-acceptance from key shareholders and board members, maintaining the target board’s recommendation of the offer, ensuring ordinary business conduct, addressing MAC, obtaining necessary regulatory and corporate approvals and achieving a specified acceptance rate (often set at 90% to facilitate the subsequent squeeze-out – see 7.6 Acquiring Less Than 100%).

As part of a voluntary offer, a bidder may also request deal security measures such as no-shop/non-solicitation. In the event of a superior offer, the target’s board normally retains the option of withdrawing or amending its recommendation. It is permissible to charge break fees up to a certain level; see 6.6 Break Fees.

If an offer closes with less than 90% acceptance rate, repeated mandatory offer obligations may apply (see 7.3 Mandatory Offer Thresholds), but no additional governance rights arise beyond those attaching to the shares held.

Effective control of a Norwegian company’s operations and dividend levels is achieved through board control, which is achieved at more than 50% of the votes cast. Effective control over new share issues, capital structure changes, mergers and de-mergers is achieved at two-thirds of the votes cast.

A bidder can squeeze out remaining shareholders if the bidder successfully acquires 90% or more of the target shares. A squeeze-out procedure usually takes one or two business days, with the consideration, as the general rule, being the cash equivalent in NOK of the tender offer price.

Debt pushdown is usually facilitated through dividend payments from the target being resolved after the bidder has conducted a squeeze-out and acquired 100% of the shares in the target.

It is common for the principal shareholder(s) to obtain irrevocable commitments to tender and/or vote if the bid premium is acceptable. These agreements are usually negotiated shortly before the launch of the offer from a selected group of shareholders wall-crossed prior to offer announcement.

Undertakings usually provide the shareholder with the opportunity to withdraw if a superior offer is made. It is possible, however, to obtain unconditional undertakings if the principal shareholder(s) believe/s the offer is attractive.

In Norway, equity incentivisation of management is a common feature of private equity transactions, to ensure that the interests of portfolio companies’ senior management or key personnel align with those of the private equity fund, motivating them to create further value and maximise returns on successful exits.

The size of management’s investment varies depending on whether they are rolling over existing shares or injecting new capital. Management must have capital at risk in order to achieve a tax-efficient structure and typically subscribes at the same price as the private equity sponsor, although with different allocations of preference shares and ordinary shares. Selling members of management are often required to re-invest a significant portion of their sale proceeds (20–50%, or higher for key persons), subject to negotiations and individual exceptions.

Any gains realised by management on re-investments are, in principle, subject to capital gains tax. If, however, management holds the initial investment through separate holding companies and re-invests through that holding company, tax would be avoided (or more precisely postponed until distributions are made from the holding entity).

It is important both for management and for the private equity fund that management’s investment is made at fair market value, although the tax authorities have historically recognised that shares acquired by management can be transferred at a reduced market value (typically 20–30%) to reflect the value impact of lock-up provisions, minority position and illiquidity, typically calculated using the Black-Scholes-Merton approach. If the incentives for management are not granted at market price, any benefit would typically give rise to payroll tax (which carries a higher rate than capital gains tax) for the relevant manager, and trigger social security contributions for the employer entity of up to 14.1%.

At fund level, incentivisation of key personnel is commonly equity-based. The AIF Act imposes certain remuneration restrictions on AIFMs.

The private equity fund’s investment, and that of any financial co-investors (the institutional strip), typically comprises a mix of ordinary and preference shares, with a significantly higher percentage of preference shares. Management’s strip often primarily consists of ordinary shares, although variation exists, such as requiring management to invest in both the institutional and management strip, with variations depending on the person’s role/significance. Institutional strips may comprise shareholder loans, but these are less common due to tax implications.

Preference shares normally entitle the private equity fund to receive its entire invested amount plus a predefined (preferred) return before ordinary shareholders receive distributions; once preferred return (including interest and investment amount) has been distributed, residual proceeds are allocated to ordinary shares.

Management is usually more heavily exposed to ordinary shares and may potentially earn a higher relative return on their investment in successful exits (reflecting the increased risk associated with the ordinary shares), but faces limited distributions if proceeds are insufficient.

Incentive schemes for management have evolved from option and bonus-based to predominantly investment-based models, although exit bonus arrangements (subject to payroll tax and social security contributions) are also applied.

Management typically invests via the Norwegian holding structure (TopCo or, if a MidCo level is in place, MidCo). For management, particularly for minority positions, it is common to establish a separate management holding company (ManCo) co-owned and (indirectly) controlled by the private equity fund.

Management co-investors are usually required to accept call options for their shares in the event that their employment in the target group is terminated. Leaver provisions are typically divided into:

• good leavers (eg, long-term illness, retirement, disability, death or involuntary termination without cause);
• bad leavers (eg, voluntary termination prior to exit, summary dismissal or material breach); and
• occasionally, “intermediate” or “very bad” leavers.

Generally, a good leaver receives fair market value for the shares, whereas a bad or very bad leaver must sell at a discount, typically the lower of cost and between 50% and 100% of fair market value.

Leaver provisions in Norwegian private equity deals are not always linked to a vesting model, but this is fairly common. The provisions are typically time-based, linked to the good leaver and/or intermediate leaver provisions and vary depending on how early the person leaves. A vesting period of up to five years is common, with only vested shares redeemable at fair market value, and unvested shares redeemable at a lower value.

Management shareholders are often required to accept non-compete and non-solicitation provisions in addition to drag, lock-up and standstill, right of first refusal and leaver provisions (including price reductions triggered by leaver events). Non-compete and non-solicitation undertakings typically span 12–18 months, with 12 months becoming more common.

These restrictions are usually (together with other restrictive covenants) included in the share purchase agreement (or other transaction agreement), in the shareholders’ agreement, as well as in the employment/service agreement.

Certain regulatory limits on enforceability apply. Under Norwegian anti-trust regulations, restrictive covenants are generally acceptable if they last no longer than three years – depending on the transaction, involving significant goodwill or know-how – and are geographically limited to areas where the target previously operated.

Furthermore, the Norwegian Working Environment Act stipulates that non-compete clauses imposed by employers must compensate employees and cannot extend beyond 12 months post-employment, except for agreements entered into with CEOs. Restrictive covenants in the employment agreement may be treated separately from those applicable to the individual in their capacity as shareholder or selling shareholder.

It is uncommon for management shareholders to be granted minority protection rights beyond what is provided under Norwegian company legislation, unless they possess a significant minority interest and negotiating power. Under Norwegian company law, minority shareholders enjoy certain statutory rights – including the right to challenge corporate resolutions in court, attend and speak at shareholder meetings, and certain disclosure rights – some of which can be waived, while others may be limited by the shareholders’ agreement.

Minority rights are often limited through mechanisms like different share classes with varied voting and financial rights, and by incorporating leaver provisions in the shareholders’ agreement. Pooling management investments into a separate ManCo (indirectly) controlled by the private equity fund also mitigates the influence of minority protections.

Management is rarely granted anti-dilution protection, veto rights or control over exits. Management may be granted the right to board representation or an observer seat, but in practice this does not give management shareholders any influence or control over the portfolio company.

Norwegian private equity funds typically seek control over portfolio companies to exercise active ownership, achieved through majority shareholding and typically governed by a shareholders’ agreement (which is also the preferred governance mechanism where a controlling interest cannot be obtained). Through either route, funds typically secure rights to information, board control and approval over all key decisions, including share issues, major acquisitions, business changes or asset disposals, borrowing, business plans and budgets, and procedures for liquidation and exit. While a shareholders’ agreement may also include veto rights for the private equity fund, such rights are largely redundant where the fund already holds a controlling interest.

Under Norwegian law, a company and its shareholders are separate legal entities and are not, as a general rule, liable for each other’s obligations. This principle applies regardless of the company’s structure, including parent–subsidiary arrangements, and the limitations on shareholders’ liability are generally robust.

Case law predominantly supports maintaining the corporate veil, even where the company is engaged in high-risk business, reserving its piercing only for exceptional cases. There is no Supreme Court precedent for piercing the corporate veil. There is, however, a separate and more established risk that a shareholder (and in particular a parent company) may incur liability for a subsidiary’s environmental obligations under Norwegian environmental legislation.

The typical target holding period for Norwegian private equity investments ranges from three to five years, as funds aim to return capital with appreciation to investors within a reasonable timeframe.

Trade sales and IPOs have historically been considered the preferred exit strategies. Before 2020, trade sales to industrial investors or secondary sales to other private equity funds dominated in the Nordic countries, to a large extent replacing IPOs. The Norwegian IPO and listing market has recovered from the subdued levels seen in 2022–2024, with activity in H1 2026 exceeding H1 2025. Activity remains well below the exceptional Covid levels of 2020 and 2021, which were driven by unusually favourable market conditions, including low interest rates and abundant liquidity, as detailed in 1. Transaction Activity.

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 refinancing) 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 vehicles or later flagship funds in general partner-led transactions.

Drag and tag rights are typical in equity arrangements in Norwegian private equity deals to facilitate exits.

Institutional co-investors and management must usually accept drag mechanisms in the shareholders’ agreement. The typical drag threshold ranges between 50% and two-thirds of the aggregate equity; in practice, drag rights are rarely exercised as target shares are typically sold voluntarily.

Institutional co-investors and management are generally granted tag rights if the private equity fund sells its stake in the portfolio company, typically with a threshold of 50% or more of the aggregate equity.

In an IPO exit, the private equity seller typically faces a lock-up period of 6–12 months, primarily to reduce perceived sell-down overhang.

It is uncommon for the private equity seller and target to enter into relationship agreements.