Investor Comments On Volvo's Acquisition of Shares in Scania

18 January 1999

Investor Comments On Volvo's Acquisition of Shares in Scania

    STOCKHOLM, Sweden--January 15, 1999--"It is unfortunate that Volvo, with this action, has made discussions that have been conducted so far more difficult," said Claes Dahlback, president and chief executive officer of Investor AB, commenting on Volvo's acquisition of shares in Scania.
    "Our judgement is that Scania is a strong company that has excellent possibilities for positive development of its own. Investor has, however, as the largest owner in Scania, been contacted by and has had discussions not only with Volvo but also with other companies in the sector. Our intention is to find the best future strategy for Scania, and thus also create value for Scania's shareholders," said Dahlback.
    "The discussions that have been conducted up to now have not led to any concrete results, which to a large extent stems from different opinions of Scania's value. We feel Scania's existing share price does not correctly reflect the company's earning capacity.
    "A merger with Volvo could result in significant synergy gains, but at the same time we also see other alternatives that could be even more interesting. Our intention is to continue discussions with interested parties," said Claes Dahlback.
    Investor owns shares corresponding to 45.5% of votes and capital in Scania. Part of these shares provide a base for warrants issued, which at the end of the year corresponded to 3.5% of the votes and 19.0% of the capital in Scania AB.
    Investor AB is the largest Swedish industrial holding company. It generates value for its shareholders through long-term active ownership, active investment operations and trading. Over the past 25 years the average total annual return to shareholders has exceeded 20%.
    Investor AB owns a portfolio of major holdings in a number of Sweden's largest most internationally active industrial companies. These include Astra, Incentive, Scania, Ericsson, ABB, STORA, Atlas Copco, S-E-Banken, SKF, WM-data, Saab, SAS, OM Gruppen, and Electrolux. Its largest shareholders are the Wallenberg family foundations and a number of mutual and pension funds.
    Investor AB is based in Stockholm, with offices in Hong Kong, London and New York.