President & Chief Executive Officer, L E Lundbergföretagen
Fredrik Lundberg: Så ska jag ratta Industrivärden
Fredrik Lundberg berättar i denna exklusiva intervju varför inte Anders Nyrén är lämplig som ordförande i Industrivärden samt hur han själv tänkt sig styra sfären.
Anledning till att Anders Nyrén får lämna Industrivärden är den hårda kritik han fått i spåren av turerna kring SCA. Och det är inte bara ordförandeposten han går miste om, utan även vd-post i bolaget som han får lämna. Dessutom lämnar han styrelserna i SCA och Handelsbanken.
Den som föreslås ta över som ordförande i Industrivärden är Fredrik Lundberg, som är storägare i Industrivärden. EFN:s Charlotte Stjerngren har fått en exklu...
About Fredrik Lundberg
In a 2015 interview, Fredrik Lundberg stated that he had concluded it was not appropriate for Anders Nyrén to become chairman of Industrivärden, and that he had communicated this to the nomination committee. Lundberg said the committee subsequently proposed him as chairman, with the support of all major shareholders. He described taking on the role as a responsibility, noting that Lundbergs, as a major shareholder, had a duty to its own shareholders regarding its investment. Lundberg also commented on investment strategy, stating that high turnover is not a goal in itself and that the primary objective is selecting the right companies to invest in. He expressed a conservative view on leverage in an investment company, noting that portfolio companies already carry debt.
Transcript (37 segments)
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Interviewer0:07
Hello, welcome to this Studio 12 interview today with Fredrik Lundberg. Hello Fredrik, how nice to have you here today. You have been proposed as chairman of Industrivärden. Can you tell us a little about what has led to these changes?
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Fredrik Lundberg0:22
Yes, for my part, I have thought a lot recently about the board of Industrivärden and the proposed chairman Anders Nyrén, and I have come to the conclusion that it is not appropriate for him to become chairman. And then I have informed the nomination committee of that from my side, and they have handled this issue and now come up with a new proposal that all the major shareholders support.
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Interviewer0:54
How does it feel to take on this type of role? You have previously had a very withdrawn role.
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Fredrik Lundberg1:02
Yes, I think it is responsible to now take on this responsibility. Lundbergs is one of the major shareholders here. We have a responsibility to our own shareholders for the investment we have made, and in this situation that has arisen, I have declared myself willing to take on this responsibility.
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Interviewer1:18
Who actually took the initiative for this change?
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Fredrik Lundberg1:25
It was Lundbergs and Handelsbanken together. Who contacted whom? Yes, that... I can't say exactly how it happened, but Per Boman, who represents Handelsbanken, and I have discussed these issues together a lot. But then we have each taken a position on our own, as we have announced. It has been quite frank or honest how the press release came out this morning.
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Interviewer1:54
You have said that Nyrén is unsuitable. Can you tell us in what way?
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Fredrik Lundberg2:00
It is a weighing of various opinions that I have, and that is the conclusion I have come to. I do not want to go into detail about why and what facts lie behind, but the conclusion is what is important, one could say.
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Interviewer2:20
Have you been dissatisfied for a long time? From the outside, one might sometimes think, why did it take so long to let go of Nyrén?
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Fredrik Lundberg2:31
I have not been dissatisfied. And Anders Nyrén has not been chairman, and what I am saying is that I consider him unsuitable as chairman. In Lundbergs, we have had quite good returns on our investment in Industrivärden, so there is nothing I regret about having done that.
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Interviewer2:52
There will be many empty seats now when Nyrén leaves. How do you think... can you be prepared to take on additional greater responsibility? Not more board assignments?
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Fredrik Lundberg3:04
These CD4 rules about what... if you sit on a bank board, it prevents that, so for me it is not relevant with any more board assignments. Instead, Industrivärden must continue to build its network and find capable people who can help in this work. A capable person, Lars Pettersson, Sandvik's former CEO, is on Industrivärden's board. It is natural for him to take the gavel at Sandvik now that Nyrén leaves. I do not want to comment on Sandvik at all; the question is now referred to the nomination committee at Sandvik, so you will have to ask them about that.
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Interviewer3:50
But you have been on the board of Sandvik since 2006.
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Fredrik Lundberg3:56
I sat for eight years. I left last year precisely because of these bank rules that prevented me from staying.
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Interviewer4:10
Sandvik rose quite a bit today on speculation that this makes it more likely that Olof Faxander will leave.
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Fredrik Lundberg4:18
Yes, I have confidence in Olof Faxander, I can say. And Sandvik published a relatively good report today. I have not analyzed it in detail, but I perceive that it was quite good, and that is probably why the market raised the price of the stock.
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Interviewer4:37
How much currency? Many currency effects?
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Fredrik Lundberg4:41
Yes, I will look into this more closely eventually.
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Interviewer4:47
You, Stuart Graham, who is chairman of Skanska, resigned from Industrivärden's board today largely in protest against what is happening. Can he remain at Skanska?
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Fredrik Lundberg4:58
Stuart Graham is an excellent person. I have full confidence in him, and I count on him obviously remaining as chairman of Skanska. There is no question about that. I would think that what led to this was that he felt he had not received sufficient information from the major shareholders. But we have a model in Sweden where the major shareholders and those who sit with representatives on the nomination committee should turn to the nomination committee. Board composition is not something you discuss with the respective board; you do that in the nomination committee. So the major shareholders here in Industrivärden, Lundbergs and Handelsbanken, have turned to the nomination committee, they have handled the issue, and they have come up with a proposal. And that is the correct way to handle it. So I actually think there was a certain misunderstanding here.
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Interviewer5:46
Per Boman has called for further review. There are reports that 500 auditors are involved. How important do you think such a review is?
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Fredrik Lundberg5:56
I am not on the board and I have no insight into that issue. That is something that I will have to answer.
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Interviewer6:04
How do you view the existing ownership structure for Handelsbanken's? Is there reason to question any of this cross-ownership that exists?
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Fredrik Lundberg6:16
I believe that each company and each board must manage the ownership stakes they have in other companies, and I do not want to interfere in how they should handle that. From Industrivärden's point of view, it is a good portfolio company. It is a good investment for us, as is of course Handelsbanken.
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Interviewer6:36
Is there anything you think has been missing in this debate during the recent turbulence?
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Fredrik Lundberg6:44
Yes, that was not an easy question. One can always add additional themes, of course, but there has been quite extensive media turbulence for a long time now, so probably much has been captured. But I cannot say anything else about it.
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Interviewer6:58
I want to ask again how you feel about your new role, which will be more public.
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Fredrik Lundberg7:06
Yes, we will see how public it becomes. I see Industrivärden's business as a principle, an asset management, value-creating asset management, I would like to express it. And then it is about doing a good job with that. It is not about being seen the most in the media or participating in the public debate on various issues. That is not the primary thing. It is the work of generating returns on shareholders' capital that I will concentrate on.
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Interviewer7:30
Previously, Industrivärden had a target of about 10% loan-to-value ratio over the years. Now it has come up to about 14%. How do you view that today?
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Fredrik Lundberg7:38
I think one should be careful with leverage in an investment company. Because there are loans in all these portfolio companies as well. So exactly where one should be is difficult to say. But I have rather a fairly conservative view on this. Historically, Industrivärden has mostly been on the Stockholm Stock Exchange. Investor, for example, has had a portfolio of unlisted companies.
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Interviewer8:02
Is there something you can see Industrivärden could do in the future?
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Fredrik Lundberg8:08
We have not discussed that in the board. For now, the strategy is fixed, which means we only deal with listed companies. But that is a question we will have to take up in the board in the first instance.
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Interviewer8:20
You made some reallocations, sold Skanska for about 400 million and bought some Volvo. How do you view the turnover rate?
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Fredrik Lundberg8:28
Yes, it is not an end in itself to have a high turnover rate. The primary thing is that we choose the right companies to invest in and that we also manage value creation in a good way.
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Interviewer8:42
If you look at the companies Industrivärden has owned so far, I made a comparison just between your own Lundbergs, which has risen almost 800% in 15 years, Industrivärden is up 180% over the same period. So there is a huge outperformance from Lundbergs compared to Industrivärden. Have you chosen the right value-creating companies then?
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Fredrik Lundberg9:00
Yes, I cannot verify these figures you mentioned. But yes, one can naturally question whether one has done it to the fullest. Now it is the case that companies go through different cycles and are subject to different economic fluctuations, so one has to look at the return over a slightly longer period.
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Interviewer9:20
Thank you very much for having us. Thank you. Thank you, thank you.