Cevian Capital is an international investment firm founded back in 2002, by Lars Förberg and Christer Gardell, which has grown to be Europe’s biggest activist manager and the second biggest dedicated activist globally. The firm is advised by Cevian Capital AB (Stockholm), Cevian Capital LLP (London) and Cevian Capital AG (Zürich). Its co-founder, Mr. Förberg, has comprehensive investing experience in a plethora of industries, and across many countries, mainly dealing with companies that are going through some kind of operational and/or strategic adjustments. Before launching Cevian Capital with Christer Gardell, Mr. Förberg was an Investment Manager and Partner at Nordic Capital. He earned his M.Sc. in Economics and Business Administration from the Stockholm School of Economics (counting studies at the University of Michigan) and holds 2nd year of MBA program from the University of Michigan. Mr. Gardell also brings a lot of professional expertise to Cevian, as prior to co-founding the firm, he was also appointed at Nordic Capital, where he was a Senior Partner. He earned his MBA and Master of Science in Economics from Stockholm School of Economics (counting studies at the Business Schools, and holding a B.Sc. In Economics).
European public companies from industrial, financial, and manufacturing sectors are the fund’s main targets, as these best match its investing approach, which is value driven. Cevian Capital looks for doubling its investment in the span of three to five years, owns a concentrated portfolio (with 10 to 12 positions) with an average period of holding from three to five years, has one strategy and one fund. Its current fund, Cevian Capital II was launched 12 years ago, and since its inception through January it has brought back an eye-popping return of 260%, compared to 77% that MSCI Europe Index delivered in the same period. In the first year of its launch from July 2006, through the end of October the same year, Cevian Capital II returned 18%, beating the HFRI Event-Driven (Total) Index, which delivered 4.3%; in 2009, Cevian Capital II generated a return of 35.7%, and in 2016, it gained 19.4%. According to its website, the fund manages more than €13 billion (around $14.83 billion), with more than a half of its investors being institutions, such as pension funds and endowments, and the rest making family offices and funds. Of course, all partners of Cevian are also its investors. It is interesting to mention that one of its publicly disclosed investors is billionaire Carl Icahn.
Two significant contributors to Cevian Capital’s astonishing performance in the recent period were Volvo AB Class B (STO:VOLV-B) and Danske Bank A/S (CPH:DANSKE) exits. Namely, at the end of 2017, the fund sold its long-held stake in Volvo to China’s Gelly for around €3 billion, making an income of about €2 billion counting dividends. Before exiting and hence making this the most profitable activist investment ever, Cevian Capital held a position in the company for 12 years, sticking out and even raising its position during the “tough years” for Volvo. At the end of 2017, the fund also sold out its 6 years held long position in Danske Bank making a strong annualized return – a profit of almost 300% when counting dividends.
On the next page, you can read more about Cevian Capital’s activism approach and its top stock picks.