Ingka Investments, the largest franchisee of IKEA and the investment arm of Ingka Group, is undertaking its largest land acquisition to date. The company is set to purchase approximately 380,000 acres of forest land in Estonia and Latvia, a deal valued at around ₹7.39 lakh crore (€720 million). This significant acquisition is primarily aimed at securing sustainable raw material essential for IKEA's furniture production. The land is being acquired from Sweden’s forest owners’ association Sodra, with the transaction announced on October 20 and currently awaiting regulatory approvals.

A substantial portion, around 90 percent, of the acquired land is covered by woods, which is a critical factor aligning with IKEA's long-term strategy to invest sustainably and bolster local value chains. Peter van der Poel, Managing Director of Ingka Group, highlighted the company's commitment to adopting a “generational view” concerning both forest management practices and the supply of renewable materials for IKEA. The strategic plan also involves partnering with Baltic sawmills and panel manufacturers to facilitate regional wood processing, thereby further integrating sustainability into the entire supply chain.

This new acquisition enhances Ingka Group's existing portfolio, as it already manages 331,000 hectares of forest land across seven different countries. Ingka Group, responsible for operating IKEA stores in 31 markets and accounting for 87% of global IKEA retail sales, is structured as a charitable foundation. This unique ownership model allows the group to reinvest its profits directly back into its business operations and various sustainability projects, rather than distributing dividends to shareholders.

The purchase of this forest land pushes Ingka’s total recent investments past the €1 billion mark. Other notable investments recently made by the group include the acquisition of Locus, an artificial intelligence logistics platform, a flagship retail and office property in Manhattan designated for a second IKEA store, and a minority stake in Vanguard Renewables, a company specializing in converting food waste into renewable natural gas. Lotta Lyra, CEO of Sodra, commented that the sale enables the cooperative to focus its efforts on enhancing the value of its members’ Swedish forests.