Investor buys big in defence concern Saab

The Wallenberg-family controlled firm Investor has purchased 11.2 million b-shares, 10.2 percent of the capital, in defence concern Saab. The price tag comes in at 1.1 billion kronor ($150 million), according to a statement.

• Defence firm Saab returns to profitability (14 Feb 10)

Before the purchase of the shares from UK defence firm BAE Systems, Investor owned 19.8 percent of the capital and 38 percent of the votes in the Swedish concern.

According to the Investor statement, BAE Systems plans to sell off its entire shareholding in Saab during 2010.

In 1995 Saab and BAE Systems formed a jointly owned company to develop the JAS 39 Gripen fighter aircraft. BAE Systems at the time bought 35 percent of Saab shares from Investor. The UK firm has since sold off some of the shares.

Over time the business interests of BAE Systems and Saab have gone their separate ways. Investor has pledged to support Saab's continued restructuring, the firm said in its statement.

"In line with our stated strategy to strengthen ownership in our key investments, we have now acted on an opportunity to increase our ownership stake to what we consider to be an attractive price," Investor CEO Börje Ekholm said.

The transaction will not result in any mandatory bid obligations, according to Oscar Stege Unger at Investor.

The share purchase was completed at 95.50 kronor per share; Thursday's closing price for Saab amounted to 105.50 kronor.

"We have previously held 38 percent of Saab, so we have already secured an exception from mandatory bid regulations," he told news agency TT.

Saab's third major shareholder is one of the Wallenberg family foundations, with around 5 percent of the votes.

Investor has motivated increasing its stake in Saab in that "at these levels" it becomes an interesting financial deal, Oscar Stege Unger said. The deal furthermore follows a successive winding up of the cooperation between Saab and BAE Systems, which has continued over several years.

"They have in practice ceased, in as much as Saab manages the Gripen exports itself. There has also been a degree of overlapping between BAE and Saab in larger deals," he said.

"Now BAE have decided that they do not see this as a strategic holding and want to pull out. We also think that it is good that we clarify the ownership structure," he said.

BAE Systems also holds an interest in the European Joint Strike Fighter (JSF) project.