Old Mutual’s Hostile Takeover of Skandia
Chapter 20: Facing a New Reality
IN SEARCH OF A ‘WHITE KNIGHT’ As new chair of the Skandia board, Lennart Jeansson went to London to meet his counterpart at Old Mutual, Christopher Collins. Jeansson explained to Collins the Skandia board’s new and negative position regarding the bid. He expressed confidence after the meeting that Collins had understood the purport of what he had said. Jeansson told his fellow directors on the Skandia board that Old Mutual would soon withdraw its bid. However, Lennart Jeansson was mistaken. Collins’s role as chair and board member of the South-African-dominated (and London-listed) Old Mutual differed somewhat from the chair’s authority as stipulated by Swedish governance practice. For example, Collins presided over a board with ten directors,1 of which four were either executives or closely related to Old Mutual. For Collins and the non-executive directors, it would also be very risky to challenge the will of Jim Sutcliffe, since he was both the architect of Old Mutual’s international expansion and a very respected leader among Old Mutual’s investors – especially its South African shareholders. AP2’s quest for stand-alone supporters on the buyer side remained unanswered. Almost all Swedish institutional investors were more or less index trackers. The large Nordic bank-controlled mutual funds – that is to say, those linked to Handelsbanken, Swedbank and Nordea (that were all negative to the bid) – did not want to increase their investments. SEB Funds (a supporter of the bid) was a seller and when traders called round to potential investors, there was no one in Sweden...
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