Stockholm (NordSIP) – As the 2025 comes to an end and markets begin to prepare for next year, the process of consolidation of the AP funds is reaching its conclusion, leading AP1 and AP6 to put their houses in order ahead of their mergers with the other three AP funds. As per the May vote, AP6 will be incorporated into AP2. The operations and assets of AP1 are also being transferred to AP3 and AP4. The idea of the legislation is that fewer funds reduce costs and its aim is to create more appropriate and cost-effective management, which should benefit the pension system.
AP1 and AP6 Over the Years
Since its inception in 2001, Första AP-fonden has been tasked with managing part of Sweden’s pension capital in a responsible, cost-effective manner and with good returns. During the last 25 years, the fund has grown from approximately SEK 134 billion in assets under management (AUM) to more than SEK 500 billion.
“We are proud of the work that the entire organisation has done. Over many years, Första AP-fonden has shown that it is possible to combine high returns, responsibility, and efficiency for the benefit of todays and tomorrow’s pensioners,” says Eva Lindström, Chair of the Board of AP1.
AP6 is the buffer fund specialising in unlisted assets. AP6 is the second largest investor in private equity in Sweden after Skandia and the fifth largest investor in the Nordics, according to Arkwright’s evaluation (on behalf of the Swedish government) of the AP funds for 2024. Since its inception, AP6 has contributed SEK 72.5 billion to the pension system, corresponding to a return of 700%. The average net return (at the end of August 2025) over five years is 16.0% compared to the target of 7.0%. All sub-portfolios have an average return well above 15%. The fund capital amounts to SEK 82.9 billion.
“We are proud of what we have achieved at AP6 for the benefit of the buffer fund system and the role we have played in the private equity market, which has contributed to Sweden’s success in the area. I would like to take this opportunity to thank all employees for the fantastic work that has been done to create returns for Sweden’s pensioners. Without the staff’s expertise, commitment and professionalism, AP6 would never have become the internationally renowned investor that we are,” says Katarina Staaf, CEO of AP6.
Highlights and Controversies
In their farewell announcement, both AP1 and AP3 highlighted some of the standout contributions they were able to make over the life of their mandate.
AP1 focused on the last five years, coinciding with the tenure of Kristin Magnusson Bernard as the new CEO, which the board of AP1 argues was characterised by a clear mandate for change. “The change process implemented over the past five years has had a significant impact on the fund’s performance,” says AP1’s Lindström.
Since 2020, AP1’s average five-year return has increased to 8.2 per cent, compared to 5.8 per cent over the preceding five-year period. This represents an improvement in returns corresponding to more than SEK 40 billion. Total capital under management has increased by approximately SEK 130 billion over the past five-year period. Since 2020, management costs have decreased by almost 40%, corresponding to savings of nearly SEK 1 billion.
One of the most significant changes implemented over the last five years appears to have been AP1’s increased focus on sustainability. “The transformation has encompassed the entire business, from investment strategies, portfolio construction and capital allocation to risk, compliance and ESG. Investment strategies have been developed, sustainability work has been integrated into the entire management process, governance and control functions have been modernised, and digital solutions have streamlined operations,” AP1 explains.
The new leadership allowed AP1 to turn a new page. In 2019, the Board of Directors of AP1, dismissed Johan Magnusson from his post as CEO due to his violation of internal regulations on the holding and trading of financial instruments was the motivation for his dismissal. This dismissal was shortly followed by the dismissal of Olof Jonasson as Head of equities due to irregularities in his trading activity. At the same time, not all investments were successful. AP1, together with AP2, AP3 and AP4, took heavy losses when failed green battery maker Northvolt was unable to meet investors’ hopes.
AP6’s private equity angle allows it to make more pointed claims, noting specific far-sighted early-stage investments in some companies that have become staples of modern life. “AP6, together with Skandia, was a co-founder of Creandum and was an early investor in the development of Spotify, a very good investment for Sweden’s pensioners via AP6,” AP6 explains.
“2025 has been a special year also in other respects than that AP6 is closed down. The listing and sale of Asker Healthcare Group, one of the most successful co-investments AP6 has ever made, has generated a return of more than SEK 4 billion to the pension system,” AP6’s Staaf adds. On December 11, AP6 received the Gold Awards for Long-Term Investment Strategy at the IPE European Pension Awards 2025.
A Difficult Adjustment
Following the Swedish Parliament’s decision to reduce the number of AP funds, both AP1 and AP6 acknowledged the complexity underlying the process of winding down the funds. “This has been a challenging and complex undertaking, conducted under significant time pressure. The purpose of the work has been to ensure that the pension capital continues to be managed responsibly and with a long-term perspective,” AP1 says in its press release.
AP6 echoes these sentiments.“We are proud of what we have achieved at AP6 for the benefit of the buffer fund system and the role we have played in the private equity market, which has contributed to Sweden’s success in the area. I would like to take this opportunity to thank all employees for the fantastic work that has been done to create returns for Sweden’s pensioners. Without the staff’s expertise, commitment and professionalism, AP6 would never have become the internationally renowned investor that we are,” Staaf argues.
At the end of October, AP6 was also a part of the controversy that saw leaked internal messages and videos of Eva Halvarsson, the CEO of AP2, seemingly describing the merger process as a takeover of AP6 by AP2.
