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Skandia board recommends settlement with former chairman

In spite of the harsh criticism surrounding Skandia's settlement with Lars Ramqvist, Skandia's Board of Directors has recommended that the Annual General Meeting approve the original settlement instead of pursuing legal action against the former chairman.

Published: 16 March 2005 10:38 CET

The board wants shareholders to approve the agreement that Lars Ramqvist repay the director’s fees he received for 2000 and 2001, amounting to 2,216,667 kronor.

In a statement made to the press, Skandia’s current chairman, Bernt Magnusson, claims “a friendly settlement” with Ramqvist is in the best interest of the company: after state prosecutor Christer van der Kwast dropped the case against Ramqvist, a drawnout legal battle would incur a number of hidden costs and would prove too expensive.

“It is a much better alternative than a prolonged, costly and – not least – uncertain legal process,” said Magnusson.

Although a number of major shareowners had demanded Ramqvist be sued for damages, Skandia’s board have unanimously decided it is in the company’s better interests if Ramqvist pays back the director’s fees.

Scania review board dissects Volkswagen bid

IF Metall Union representative Johan Järvklo sits on the independent review board. File: TT

Åsa Thunman was appointed chairwoman of the committee, which has invited financial consultants from Deutsche Bank and Morgan Stanley as well as legal advisors from Swedish law firm Mannheimer Swartling to assist them in their appraisal.

Thunman said in a statement that the committee would look at whether the $9.2 billion bid was in the best interest of Scania shareholders.

The effect on Swedish industry would also be considered, underlined committee board member Peter Wallenberg Jr.

"It has noted that Volkswagen does not foresee any significant changes with regards to Scania and that Scania’s headquarters and its development centres will remain where they are today," Wallenberg Jr. said. "These matters are of course of importance to the company and for Sweden.”

At the plant in Södertälje, employees have been busy discussing the bid. Assembly line worker Ahmed told The Local that his colleagues did not fear that production would be relocated to Germany.

"They couldn't possibly move all these machines and equipment," Ahmed, which is not his real name, told The Local on Tuesday. "But everyone on the floor has been discussing the offer."

Volkswagen tabled their $9.2 billion bid to swallow up Scania last Friday. It already owns 89 percent of Scania's voting rights and 62.6 percent of the company, with VW eager to secure the nearly 40 percent they do not own. The takeover has encountered resistance from two of Scania's minority owners, however. Both insurance outfit Skandia and pension fund AP4 have expressed reservations about selling up to Volkswagen.

“Scania’s prerequisites to maintain its leading position are better as a listed company than as a subsidiary in a larger group. Skandia doesn't intend to accept the offer," Caroline af Ugglas, head of equities at Skandia, told Bloomberg over the weekend.

Scania, which was founded in 1891 and has operations in more than 100 countries, boasts 38,600 employees. Around 16,000 work with sales and servicescross the company's subsidiaries, and over 12,000 work in production units. The company has headquarters in the Swedish town of Södertälje, where almost 6,000 employees work. The headquarters also hosts the research and development operations, with 3,300 employees.

"Changing owners won't make any difference to us in the near future," assembly line worker Ahmed said. "But we do wonder if the rules will change later on."

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