Sweden

The Exchange: Pehr Gyllenhammar

23 Jun 2020

Long-time Volvo CEO Pehr Gyllenhammar was pushing radical environmental and social changes at the carmaker long before they became fashionable. One of Sweden’s most admired businessmen argues why CEOs should be paid less and how it felt to become a father again at 81.

Gilead solidifies pharma pandemic insurance premia

9 Jun 2020

The $100 bln company has an approved Covid-19 drug that the U.S. government is distributing. That helps replace maturing HIV and dwindling hep C meds, and made Gilead a takeover target. The ability to cure what ails the entire economy buffs the sector’s strong defensive nature.

Swedish virus outcomes will be hard to copy

12 May 2020

The only Western state not to enforce a lockdown has a higher death rate than Nordic peers but lower than Britain or Italy. Its economy will emerge less scarred. But that’s also because of generous welfare and the fiscal room it’s using to compensate companies for lost sales.

Corona Capital: Extended Stay, Victoria’s Secret

22 Apr 2020

Concise views on the pandemic’s corporate and financial fallout: Blackstone checks back into one of its favorite old haunts, hotel chain Extended Stay; while another private-equity shop, Sycamore, tries to dump its proposed investment in lingerie seller Victoria’s Secret.

Corona Capital: Pemex, Bond liquidity

20 Apr 2020

Concise views on the pandemic’s corporate and financial fallout: Pemex becomes world’s chunkiest fallen angel, and bond liquidity gets a needed boost.

EU banks get scary bad-debt warning from Sweden

8 Apr 2020

Swedbank’s first-quarter impairments jumped tenfold from a year earlier because of Covid-19. That’s despite a relaxed Swedish attitude to lockdowns and lenders’ accounting wiggle room. A similar spike across Europe would wipe out most profits for 2020, and bigger hits may come.

Geely picks odd timing for Volvo IPO reboot

10 Feb 2020

After abandoning a $30 bln flotation of the Swedish carmaker in 2018, its Chinese owner wants to combine it with its Hong Kong unit, and list in Sweden. A merger might create savings. Yet any benefit will be overshadowed by a tough domestic market and the coronavirus fallout.

Uncle Sam’s 5G telecom fantasy is M&A nightmare

7 Feb 2020

Attorney General William Barr thinks the U.S. could buy Nokia or Ericsson to counter China’s Huawei. But making private firms do the state’s bidding is not how America works. Wrapping suppliers in the flag would also destroy value. Selling shareholders would be the only winners.

Ericsson gives glimpse of pain from 5G squeeze

24 Jan 2020

An earnings hit from a U.S. mega-merger is only one headache for the $28 bln Swedish telecoms firm. Britain appears to be throwing a lifeline to Chinese rival Huawei. And mobile operators are pushing hard to break the pair’s grip over the $500 bln market for next-generation kit.

Soaring Swedish buyout shop looks overpriced

23 Jan 2020

The share price of $13 bln EQT has almost doubled since its September IPO. CEO Christian Sinding can point to good private-equity returns and a rapid rise in assets under management. That success may be harder to sustain given increasing competition for deals and capital.

Buy now, pay later faces Juul-style backlash

24 Dec 2019

Companies offering the credit innovation say it can drive online sales and help retailers deal with refunds. One player, Klarna, is valued at $5.5 bln. But making it a lot easier to shop for free could prompt a reaction like that which befell the vaping heavyweight.

Sweden will manage a singular rate rise

6 Dec 2019

The Nordic country’s rate setters want to lift the policy rate out of sub-zero territory in December. Sluggish growth, lower inflation and trade weakness mean they face a high burden of proof to justify such a move. Their explanation may not stretch to a second hike anytime soon.

Hadas: Sweden raises tone of negative rate debate

6 Nov 2019

Its central bank plans to increase the policy interest rate to zero. Current conventional thinking says that is a step in the wrong direction. But there are reasons to worry about minus signs on rates. If the economy emerges unscathed, others may copy the Swedish experiment.

Ericsson’s upbeat 5G forecasts still too cautious

17 Oct 2019

The Swedish telecom equipment maker has raised its 2020 sales targets by 10% to reflect strong demand for the superfast networks. Yet given market leader Huawei’s U.S. problems, that still looks conservative. The perennial underperformer may have turned a corner.

Economics Nobel prizes mix of realism and idealism

14 Oct 2019

A trio of economists, including Esther Duflo, won the award for detailed studies of what helps alleviate desperate poverty. Their secret: using a well-established scientific method. The technique has problems, but is far more realistic, and useful, than much economic theory.

Nobel Prize for batteries has a negative side

9 Oct 2019

The Swedes awarded this year’s chemistry gong to the creators of the lithium-ion battery. Its use in everything from smartphones to cars should help the energy business become more climate-friendly. But the technology creates some of its own pollution, resource and social risks.

Europe’s $8 bln buyout star outshines U.S. rivals

24 Sep 2019

That’s the market value of Swedish firm EQT after its share price popped 25% on its first morning. The valuation makes sense if pension funds and others keep pouring cash into private equity. Still, the premium to larger and more diverse groups like Blackstone is striking.

Ikea doubles down on China’s risky smaller cities

24 Sep 2019

The Swedish furniture giant will pump $1.4 bln into expanding its operations in the People’s Republic, joining Starbucks and others seeking fresh growth in poorer provinces as mature coastal markets slow. In key aspects, however, China's interior is falling behind, not catching up.

Climate-activist investors are due for a new dive

3 Sep 2019

Treating and moving water can account for 20% of energy use. And many companies are ignoring the risk to their operations of too much or too little of the liquid, judging by a recent industry conference. That presents fertile ground for pushy stock- and bondholders.

Swedish buyout firm places faith in public markets

2 Sep 2019

EQT may raise $550 mln in an IPO, soon after rival BC Partners raised a similar amount in a private sale. Both want to grow abroad and in credit and real estate. Yet choppy markets and the difficulty of valuing private equity firms make EQT CEO Christian Sinding’s job harder.