Successful IPO of LAU Infra Grupa Disproves Myth of Public Opposition to Partial Privatization

The successful initial public offering (IPO) of the state joint-stock company "LAU Infra Grupa" (formerly Latvijas autoceļu uzturētājs) has disproven a persistent assumption that Latvian society is categorically opposed to state enterprises partially entering private hands. The IPO sold shares worth approximately €6.2 million, with nearly half invested by more than 2,000 private investors across the Baltics. Of the private investors, 63% were from Latvia, and 36% from Estonia and Lithuania. Institutional investors, including pension funds managed by Luminor, Swedbank, SEB, and INVL, also participated, demonstrating institutional confidence.

Ralfs Vīlands, the author of the opinion piece, argues that this IPO is not only a significant event for Latvia's economy and capital market but also proves that the myth of public resistance is wrong. The public proved more pragmatic than assumed – there were no protests or political turmoil. People actively chose to become co-owners of a state enterprise.

Vīlands emphasizes that partial listing of shares on the stock exchange is not a sell-off of state assets but an opportunity to increase transparency, attract capital, and maintain state control. It can reduce public alienation from the state, as shareholders become interested stakeholders. Additionally, a developed capital market allows pension funds to invest in local companies.

Latvian households hold between €12 and €13 billion in bank accounts, which lose value due to inflation. IPOs can serve as a first step for people to start investing productively. The author calls for continuing this practice, as listing state enterprises on the stock exchange could be done more actively to reach the target set in the Cabinet of Ministers' 2023 report – stock market capitalization of 9% of GDP by 2027.