ZURICH, Sept 12 (Askume) – Swiss insurer Baloise (BALN.S) said on Thursday it plans to boost return on equity after activist investor Cevian Capital disclosed this week that it owns more than 9% of the company’s shares and would consider stock buybacks.
Baloise said in a statement that its new goals include a return on equity of 12% to 15%, a cash remittance of more than 2 billion Swiss francs ($2.34 billion) between 2024 and 2027 and a high cash disbursement rate of 80% or more.
CEO Michael Mueller said, “After a careful analysis of our business activities, we have identified significant potential for efficiency gains and associated cost savings and growth opportunities across all business units.”
“To maximize this potential, we are launching a realignment strategy focused on the performance of our core businesses and their ability to create value.”
The company said it would consider launching its first share buyback program next spring.
Savion unveiled its majority stake in Baloise on Monday, amid demands from shareholders for the Swiss insurer to overhaul its portfolio and boost returns.
Baloise is making plans for the future, reporting a 6.9% increase in profit attributable to shareholders in the first half of 2024, amounting to around 220 million francs.
However, due to unfavorable currency effects, trading volume fell 0.9% from the same period last year to 5.29 billion Swiss francs.
(1 USD = 0.8533 Swiss Francs)
