Sweden

EQT embodies private markets’ two big problems

18 Jan 2023

Shares in the $28 bln buyout group fell 6% after CEO Christian Sinding flagged a fundraising slowdown. Another issue is that, like its rivals, the Swedish firm spent big when asset prices were high. Its relatively steady fund valuations may not yet reflect all the future pain.

Oatly’s best turnaround recipe is dollops of cash

25 Nov 2022

Shares in the $950 mln faux-milk maker are down 80% this year, and revenue growth is slowing. CEO Toni Petersson will struggle to stop burning cash, and has ruled out selling the company. That means a looming capital hike may have to be much bigger than he currently thinks.

Plant-based food stocks lack sustainable finance

10 Jun 2022

Shares in faux-milk maker Oatly and plant-based burger purveyor Beyond Meat have tumbled this year. Despite flimsy gross margins, both still trade at a premium to bigger food rivals. Without a plan to cut costs, they will struggle to attract buyers or survive on their own.

Klarna’s $46 bln price tag endures only in theory

19 May 2022

Investors heavily marked down the value of the Swedish startup’s buy-now-pay-later rivals like Affirm. On their sales multiples, privately held Klarna’s valuation would be cut by 75%. While the business is diversified with better funding, it still requires lots of red pen.

Reinvention tops returns in Philip Morris snus bet

11 May 2022

The tobacco giant has agreed a $16 bln takeover of nicotine pouch maker Swedish Match. The deal brings it closer to being mostly smoke-free by 2025. But only rapid growth or big cost cuts can justify the 39% premium. CEO Jacek Olczak has scant room for legal or regulatory snafus.

Philip Morris’ snus deal looks doubly defensive

9 May 2022

The U.S. cigarette maker could beat a faster path to becoming a mostly smoke-free company if it snags the $12 bln Swedish Match and its chewable tobacco packs. A tie-up would be pricy, but investors’ growing yen for recession-proof stocks gives the Marlboro Man an added edge.

NFTs are more opportunity than threat for Spotify

28 Apr 2022

Music streamers have cause to fear so-called non-fungible-token platforms, which enable artists to nab bigger royalties. Yet Spotify and its peers are where the fans are. If digital collectibles take off, streamers may be able to take a piece of the pie rather than being eaten.

French financial royalty falls flat in music SPAC

19 Apr 2022

A blank-cheque vehicle backed by billionaire François-Henri Pinault and banker Matthieu Pigasse struck a $1 bln deal with Deezer. The European music streamer has carved out a niche and may fend off Spotify. But the SPAC is paying a higher multiple for a slower-growing company.

Buy gas now, pay later is a hard tiger to ride

1 Apr 2022

Fintech firms Klarna and Zip are offering U.S. punters interest-free instalments as a way to manage higher fuel bills. The fact that consumers use loans to afford mere essentials raises the risk of defaulted payments. And unlike discretionary sales, Klarna isn’t getting a fee.

Ericsson’s governance mess stretches beyond Iraq

30 Mar 2022

Investors rebuked CEO Börje Ekholm for not disclosing possible payments to Islamic State by stripping him of legal protections. The telecoms-kit maker kept voting details quiet, and its dual-class share structure means Ekholm looks safe. Investors have more reason to steer clear.

Alphabet fiddles as app-store antitrust fire burns

24 Mar 2022

The $1.8 trln Google parent will let Spotify use its own payment service, skirting a 15% fee. The move piles pressure on rival Apple to do the same. But it’s just a pilot project and probably still includes a hefty charge. U.S. and EU regulators may force the duo to go further.

EQT makes savvy $7 bln play for buyout big leagues

16 Mar 2022

The Swedish group is acquiring Baring Private Equity Asia. The price looks reasonable. And by paying mostly in stock, CEO Christian Sinding is putting his share-price premium to good use. EQT will finally have a global presence, helping it go toe-to-toe with U.S. giants like KKR.

Ericsson Iraq snafu dents already-shaky M&A logic

2 Mar 2022

The telecom kit maker’s shares fell 12% after U.S. authorities said it broke a deferred prosecution agreement over possible payments to Islamic State. A large fine would make the $6.2 bln acquisition of Vonage more risky. That puts pressure on CEO Börje Ekholm to find a way out.

Ericsson’s ISIS fallout could go beyond big fines

16 Feb 2022

The Swedish telecoms group says it may have made indirect payments to Islamist militants in Iraq. That’s way worse than the brown envelopes it sent in places like Vietnam that cost $1 bln in fines. Besides harsher U.S. penalties, Ericsson may find life tougher in its key market.

Why Spotify’s Daniel Ek is sticking with Joe Rogan

7 Feb 2022

The streaming group’s CEO condemned the talk show host’s use of racial slurs but refused to axe him. Ek is betting that financially motivated music labels will resist artist boycotts, and that users are locked in. Rogan represents a podcast pivot that’s key to boosting earnings.

Rogan deal blunts Spotify’s edgy podcast appeal

31 Jan 2022

The streaming service is slapping advisories on its shows after a Joe Rogan Covid-19 misinformation spat. The compromise stops CEO Daniel Ek looking like a censor, and cuts the risk of music subscribers tuning out. But the promise of balance in podcasts may reduce their allure.

Vodafone intruder adds hope to activist toolbox

31 Jan 2022

Shareholder Cevian Capital lacks obvious levers to boost the 36 bln pound telco’s performance. Consolidation in markets like Spain, Italy and the UK would lower costs and improve pricing. But success depends on competition watchdogs dropping their opposition to fewer operators.

Nordic $20 bln deal sets high bar for oil mergers

22 Dec 2021

Aker BP is acquiring Lundin Energy’s fossil fuel assets using cash and stock. Both sides emerge with a stake in a low-cost big hitter, better able to negotiate oil’s decline. The billionaire Lundin brothers get a smoother path out of the sector, and arguably a small premium.

Embracer rolls the dice in $3 bln board-game play

16 Dec 2021

The $9 bln Swedish video-game firm is buying France’s Asmodee, maker of tabletop titles “Catan” and “Pandemic”. The price looks fair against rival Hasbro, and tie-ups between old-school and newfangled gaming have worked. But a lack of synergies makes a winning return tricky.

Nordic drug buyout flop highlights hidden gem

3 Dec 2021

The $8 bln takeover of Swedish Orphan Biovitrum failed after buyers could not secure 90% of the shares. The market reaction suggests the deal is dead. But investor AstraZeneca’s role in the failed bid and its interest in a respiratory disease treatment provides some comfort.