Norges Bank Trims Deliveroo Stake: Strategic Shift or Market Signal?

The latest regulatory filings reveal that Norway’s sovereign wealth fund, Norges Bank, has reduced its stake in Deliveroo PLC (LSE: RZO), marking a subtle shift in its investment strategy. The move comes amid broader market dynamics, including active trading by institutional players like BNP Paribas and FMR LLC. Here’s what investors should know.

Norges Bank’s Position: A Net Reduction in Holdings

According to its Form 8.3 filing dated April 29, 2025, Norges Bank held 36,251,144 shares of Deliveroo, representing 2.42% of total outstanding shares. However, a critical detail emerges: 16.3 million shares (45% of its holding) are managed without direct discretion, likely via third-party mandates or structured arrangements.

In the reporting period, the bank executed a net sale of 6,624 shares—selling 11,534 shares at £1.7140 while purchasing only 4,910 at £1.7080. This net reduction suggests a cautious approach to Deliveroo’s valuation, despite the stock hovering near £1.71-1.72 per share in late April (see below for price trends).

Broader Market Context: Institutional Crosscurrents

While Norges Bank trimmed its position, other players were more aggressive:
- FMR LLC and FIL Limited (a major institutional investor) reported a 11.28% stake (168.8 million shares), including 789,300 shares purchased at £1.72 in late April. Their activity signals confidence in Deliveroo’s long-term prospects.
- BNP Paribas SA, meanwhile, maintained a highly leveraged position:
- 2.57% net long exposure via direct holdings and cash-settled derivatives.
- -2.52% net short exposure via derivatives, suggesting hedging or speculative bets on volatility.

BNP’s activity—over 60 transactions totaling 21.8 million shares—hints at a tactical strategy, possibly to profit from short-term price swings or mitigate risks in a volatile market.

Regulatory Implications: The Takeover Code’s Role

The filings are required under the UK Takeover Code’s Rule 8.3, which mandates public disclosure when stakes exceed 1%. While Norges Bank’s 2.42% stake is below the 3% threshold typically signaling activist intent, the reduction could foreshadow broader sentiment shifts.

Notably, neither Norges Bank nor BNP disclosed stock-settled derivatives or voting agreements, indicating a lack of immediate takeover ambitions. However, FMR’s substantial holding (11.28%) leaves room for speculation about future consolidation.

Key Data Points to Watch

• Share Price Stability: Deliveroo’s stock has traded within a tight range of £1.68–1.75 over the past quarter (see visual above). A sustained breakout above £1.80 could signal renewed institutional confidence.
• Earnings Momentum: Deliveroo reported a £400 million revenue run rate in Q1 2025, but margins remain pressured by delivery costs.
• Competitor Dynamics: Rival Uber Eats continues to gain market share in key UK cities, pressuring Deliveroo’s growth narrative.

Conclusion: A Cautionary Trim or Strategic Rebalancing?

Norges Bank’s decision to reduce its Deliveroo stake—despite holding a non-controlling position—warrants scrutiny. The net sale of shares, coupled with its lack of derivatives exposure, suggests a tactical rebalancing rather than a full retreat.

Meanwhile, FMR’s accumulation and BNP’s speculative derivatives activity highlight divergent views on Deliveroo’s valuation. Investors should monitor whether the stock can sustain momentum above £1.75, a level that could validate institutional optimism.

With Deliveroo’s £1.2 billion market cap and a price-to-sales ratio of 0.3x, the stock remains cheap relative to peers. However, execution risks—such as margin improvement and competition—will ultimately determine whether this round of stake adjustments foreshadows long-term trends or merely reflects short-term trading noise.

In short: Norges Bank’s move is a cautious nudge, but the bigger story lies in the broader institutional crosscurrents reshaping Deliveroo’s investment landscape.