March 7, 2017 / 6:34 AM / in 4 months

UPDATE 1-Folksam cuts stake in Swedbank to 7 percent

2 Min Read

(Rewrites to show sale is completed, adds selling price)

STOCKHOLM, March 7 (Reuters) - Swedish mutual insurance company Folksam has sold 25.6 million shares in Swedbank , or 2.3 percent of the total Swedbank share capital, for about $622 million, it said late on Monday.

Folksam, one of Sweden's largest investment managers and Swedbank's second-largest owner, cut its holding in the bank to 7 percent but said it was not looking to reduce its stake further.

"Our ownership in Swedbank remains long-term both in financial and strategic aspects, even though this was the right time to decrease the Swedbank concentration in our asset portfolios," Folksam Chief Executive Jens Henriksson said in a statement.

The stake was sold at 219 crowns per share in a bookbuilding process to institutional investors, a 2.6 percent discount compared to Swedbank's closing price on Monday.

Swedbank was hardest hit of the Swedish banks during the financial crisis and Folksam became a major shareholder in 2008 when the bank was forced to raise capital in a share rights issue.

Folksam said the return on the Swedbank investment amounted to about 22 billion Swedish crowns ($2.44 billion) since 2008.

J.P. Morgan acted as bookrunner in connection with the placing. ($1 = 9.0107 Swedish crowns) (Reporting by Johan Sennero and Johannes Hellstrom; Editing by Susan Thomas)

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