Article in WSJ, November 28, 2007
The November 28, 2007 edition of the Wall Street Journal features an interview with Investor CEO Börje Ekholm in which he describes Investor’s plans to increase the proportion of investments in unlisted assets from today’s 17 percent to 25 percent in three to five years. The title of the article is “Investor AB’s Private Act”.
In the article, written by WSJ journalist Jenny Clevstrom, Mr. Ekholm states “that it’s easier to create value in an unlisted environment and to take on changes needed without having to worry about how it looks from the outside.”
Gambro given as example
The article gives the example of the healthcare company Gambro Holding, which Investor and EQT took private last year.
In 18 months, Investor and EQT changed Gambro’s board, part of its management, created three independent units out of the company, later sold one, stepped up investments in new products and to improve quality, and resolved the import ban for dialysis machines in the U.S. Mr. Ekholm states that this would have virtually been impossible in a listed environment.
“Small but significant” shift in direction
The WSJ article describes the shift to include more unlisted assets to as “small but significant”, considering that Investor has mostly had holdings in public companies up to now. This shift in direction, writes Jenny Clevstrom, comes at a time when many private equity transactions are being cancelled because of tighter credit.
She then comments on Investor’s strong balance sheet which “could offer some protection from the wider market fallout” and mentions the recent Moody’s upgrade of Investor from A2 to A1 and its affirmation of Investor’s Primate-1 rating for short-term debt.
“Also treading carefully”
“Investor is also treading carefully,” concludes Jenny Clevstrom, noting that the bulk of Investor’s investments remain in listed assets. She quotes CEO Ekholm, who says that Investor will target sectors “with long-term growth potential”, like the health and medical areas,” which Mr. Ekholm considers “set for strong growth driven by demographics.”
Information updated 2007-11-29 17:30:29