Norway's sovereign wealth fund to sue VW over emissions scandal

One of the world's largest sovereign wealth funds on Monday said it was considering a lawsuit against German car giant Volkswagen over the emissions scandal related to its diesel cars.

The Norwegian Government Pension Fund Global, which is also one of the carmaker's larger owners, said it "intends to join a legal action against Volkswagen," citing that the company "provided incorrect emissions data."

"It is the board's responsibility to ensure accurate and timely information is disclosed to the shareholders," said Norges Bank Investment Management, the central bank unit that manages the pension fund, in a statement emailed to dpa.

The Norwegian pension fund was at the end of March worth about 850 billion dollars. Its holdings in Volkswagen were at the end of December valued at 750 million dollars.

"Volkswagen informed the public about the incorrect emissions data after US authorities released a notice of violation letter," the statement added.

This referred to revelations about VW diesel cars' ability to circumvent emissions tests that was made public in September by the US Environmental Protection Agency. The company subsequently admitted that more than 11 million of its vehicles were fitted with so-called "defeat devices."

Volkswagen faces a string of lawsuits from institutional investors  and other groups seeking compensation.

The Norwegian fund said it was "evaluating the expertise and the economics of each litigation group that has emerged in this case."

The fund had no further comment related to legal advisors.

The Norwegian fund had holdings in 9,050 companies at the end of 2015. It also invests in bonds and real estate. It was set up 1996 to invest income from the country's petroleum and gas sectors. 

The fund has a 1.64-per-cent voting share in the German carmaker but is not on VW's supervisory board, according to Bloomberg data cited by the Financial Times newspaper.

Earlier, the Financial Times quoted Petter Johnsen, chief investment officer for equity strategies at the central bank's investment management unit about the plans.

"We have been advised by our lawyers that the company's conduct gives rise to legal claims under German law," said Johnsen. "As an investor it is our responsibility to safeguard the fund's holding in Volkswagen."

"Volkswagen management should have known about the manipulative engine-management devices," he said.

The report said the fund has informed VW's supervisory board chairman, Hans Dieter Poetsch, of the decision. 

Last update: Mon, 16/05/2016 - 18:13
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