Altor, Bure in duo of Swedish deals

The Nordic investment firms will buy beleaguered Swedish investment bank Carnegie and its insurance broker affiliate Max Matthiessen, both of which were seized by the Swedish government last year.

Altor Equity Partners and listed investment firm Bure Equity are purchasing two financial services companies from the Swedish government in two separate transactions worth a total of more than SEK1.9 billion (€178 million; $230 million).

The firms have agreed to purchase Stockholm-headquartered insurance broker Max Matthiessen, in a total consideration of shares worth SEK500 million. They will also pay SEK1.4 billion in cash for all shares in its parent company, Carnegie Investment Bank.

Carnegie was taken over by Sweden’s National Debt Office in December 2008 after its banking licence was revoked due to what the Swedish Financial Services Authority said was “illegal trading activities”. The investment bank’s shares dropped more than 50 percent in value from SEK45 billion at the end of the second quarter last year, to SEK14 billion at the end of the fourth quarter 2008. The National Debt Office acquired the firm in a decision to “preserve the value of the collateral”, and has since substantially converted all of its outstanding debt to Carnegie into equity, it said.

Carnegie acquired Max Matthiessen in January 2007 in an approximately SEK 856 million deal. It was seized by the Swedish National Debt Office along with Carnegie last year.

Both companies will be acquired through separate holding companies which are each 65 percent owned by Altor and 35 percent owned by Bure. Both deals are expected to complete within the next three months, and are subject to clearance from the Swedish Financial Services Authority.

Financial advisors for both deals were Morgan Stanley, Lenner & Partners and PricewaterhouseCoopers.

Sweden-based Altor will make the investment from its Altor Fund III, which hit its €2 billion hard cap in August 2008 after just two months of marketing. The firm has combined assets under management of €13.4 billion.

Bure was listed on the OMX Stockholm Stock Exchange in 1993 and has a current market capitalisation of SEK1.2 billion.