Full takeover of Skandia imminent

Anglo-South African insurer Old Mutual said Thursday that it now owned 98.09 percent in Skandia, clearing the way for it to take full control of its Swedish peer.

Old Mutual said in an official statement to the London Stock Exchange that its 4.8-billion-euro bid was now closed, while a further update would be given on March 22.

The remaining shares would be obtained by a compulsory purchase procedure, under Swedish stock exchange rules, and this is expected to begin in June.

“I am delighted that we have reached our goal,” said Jim Sutcliffe, chief executive of Old Mutual.

“We have acquired a great company and are working with our new colleagues as we get ourselves in shape to take advantage of the many opportunities that lie ahead.”

There has been no doubt about the outcome of the hostile offer for weeks.

Last Monday Old Mutual said it had crossed the 90.0-percent threshold, which entitled the group to take full control of Skandia by forcibly converting remaining shareholdings.

Old Mutual originally lodged its hostile offer of 43.60 kronor per Skandia share in September last year, valuing Skandia at 44.9 billion kronor.

The deal will create one of the biggest insurance groups in Europe and is aimed also at reducing the Old Mutual’s dependence on the South African market.



Scania review board dissects Volkswagen bid

The independent committee looking at Volkswagen's take-over bid of Swedish truck giant Scania began its work on Tuesday, stating promises that headquarters would remain in Sweden were paramount.

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."