ZURICH, Sept 9 (Askume) – Activist investor Cevian Capital said on Monday it had raised its stake in Baloise Holding (BALN.S) , boosting its ability to force changes at the Swiss insurer.
Savion currently holds approximately 9.4% of Baloise shares and is the company’s largest investor.
The investment increases Savion’s 3.12% stake in Baloise, which was disclosed earlier this year. The shareholding ratio rose to 5.11% as of June, according to Swiss stock market disclosures.
“Baloise has the opportunity to become one of the best-performing insurance companies in Switzerland,” said Robert Shuchna, partner at Cevian. “We believe the company has significant value potential.”
Cevian, which has offices near Stockholm, London and Zurich, has previously invested in Swiss engineering group ABB ABBn.S and reported to UBS last year.(UBSG.S) and said it wants to double the value of its stake.
The company has not yet revealed its plans for the Baloise.
The Financial Times, which first reported the stake hike, said investors had been pressing for strategic changes at the company.
Citing people familiar with the matter, the paper said Savion wants Baloise management to refocus the group on countries where it is strongest and has a higher market share, and use more cash generation for shareholder returns and investments in domestic markets.
The stake hike comes after Baloise shareholders voted in April to remove a 2% cap on voting rights that had previously limited their influence over the company’s management.
Baloise has endured a tough few years, with the Basel-based company’s share price hit by rival insurers and investors concerned about the performance of its business outside its home market of Switzerland.
The company’s stock has performed poorly over the last two years, lagging its insurance peers (.SXIP) by about 15%.
A Baloise spokesman said: “We look forward to September 12 when we will communicate Baloise’s strategic direction in an investor update.”
The company is scheduled to announce its half-year results and update investors on the same day, and is expected to announce new mid-term targets.
