Old Mutual’s Hostile Takeover of Skandia
CHANGES IN SHAREHOLDING AND BOARD COMPOSITION Skandia had been a target for structural deals since 8 October 1990, when Skandinaviska Enskilda Banken1 (later SEB), along with the Wallenberg group as the dominating shareholder, acquired 28.2 per cent of the shares in Skandia; the aim was a full-fledged merger between the bank and the insurance company (both its life arm and P&C business). The plan was prepared before the change of European Community regulations, which opened up for a new financial sector, allowing banks and insurance companies to merge. In the late 1980s, such financial cross-sector mergers were very high-profile. The seller of the Skandia shares was the investment company Investor, which was controlled by the Wallenberg foundation and the family-owned publishing house Bonniers, of which Bengt Braun was the CEO. This planned deal was instantly met with opposition. Skandia’s CEO, Björn Wolrath, did not like the way the proposed merger was presented by SEB, as the bank was aiming for a takeover and not a merger of two equal parties. This was a problem since SEB needed support from the Skandia board and management to overcome the voting rules that blocked control of the company.2 Furthermore, SEB lacked financial resources to afford an outright hostile bid on the company, something that would demand a premium (and the bank was not interested in a passive investment in Skandia). In 1991, SEB teamed up with three Nordic insurance companies: Norwegian Uni Storebrand, Danish Hafnia and Finnish Pohjola. This group of...
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