EQT establishes holding company in Sweden for operations and new funds

• EQT will organize all activities under one holding company – EQT Holdings AB

• EQT has grown to become a major owner in many economies, which increases the requirements for openness and clear governance. The establishment of EQT Holdings AB, demonstrates EQT’s ambition to meet these requirements, following last year’s decision to manage all funds established in 2012 and onwards onshore in Europe

• Investor AB will be a shareholder in the new holding structure together with partners of the investment advisor EQT Partners

EQT has implemented a new corporate structure in order to better align with various stakeholders. The new structure will facilitate growth, as well as increase transparency and secure a solid, long-term financial platform. The aim is to make EQT an even more trusted owner. It is envisaged that going forward, operations, fund administration and investments in general partners will be brought together under EQT Holdings AB, a company based in Stockholm, Sweden. Conni Jonsson is CEO of EQT Holdings AB.

Currently, EQT consists of 15 funds with a combined committed capital of EUR 20 billion. In 2012, sales of EQT’s 49 portfolio companies increased on average by 11% compared to 2011 and EBITDA increased by an average of 10%. By the end of 2012, the number of employees stood at more than 550,000.

“Since the start of EQT Partners in 1994 and the first EQT fund raised in 1995, there has been strong growth. In order to support the future growth and to become an even more trusted owner, a new efficient and transparent corporate structure has been established. EQT Holdings AB will have an independent Board of Directors and a Nordic governance structure. This is a natural step following the decision to manage all funds established 2012 and onwards onshore in Europe, in places such as the Netherlands, Luxembourg and the UK. Our ambition is to secure trust and demonstrate co-operation with all stakeholders in addition to delivering good returns to EQT’s investors. In the future, we would like it to be possible to establish EQT funds also in the Nordic countries,” says Conni Jonsson, Managing Partner and co-founder of EQT.

The new structure enables EQT Holdings AB to accumulate a sustainable and long-term financial reserve for stable organic expansion and a buffer across business cycles.

EQT Holdings AB will be 81% owned by partners of the investment advisor EQT Partners. The remaining 19% will be owned by Investor AB. Investor AB will exchange its current 31% in EQT Partners AB for the ownership stake in EQT Holdings AB.

“We are happy that our relationship with Investor AB continues in this way. Investor AB remains a key investor in the EQT funds and we share the same passion for the growth and development of successful companies. We also share the Wallenberg group’s values and unique network,” said Conni Jonsson.

The owners of EQT Holdings AB will jointly appoint a new board for EQT Holdings AB. This process is currently underway and the board will consist of senior and experienced international industrialists.

Fund managers established from 2012 and onwards will be part of the new structure. Older funds retain the former structure.

“By making these changes, it not only secures a platform for future growth, but I believe we are also taking a lead in moving EQT further towards alignment with current values and requirements in society, for better transparency, accountability and performance,” says Conni Jonsson.

Investor AB’s and the partners’ ownership in EQT Holdings AB is subject to required regulatory approvals and notifications.

Facts about EQT

EQT is the leading private equity group in Northern Europe with approximately EUR 20 billion in raised capital, portfolio companies with total sales of more than EUR 25 billion and over 550,000 employees. The funds’ investment philosophy is to help acquired companies grow and develop into great and sustainable companies, both under EQT’s ownership and with future owners. The result so far: the over 60 previously or currently owned portfolio companies have during EQT’s ownership seen an average annual increase in the number of employees by 11%, sales by 11% and earnings by 15%. Almost all of the return on investments is attributed to operational improvements such as increased sales and efficiency gains.

EQT supports a growth oriented business strategy, which has its roots in the Nordic culture, and a transparent governance model, combined with access to EQT’s unique international network of industrialists. By implementing clear strategies and having access to operational expertise and ownership skills, the portfolio companies develop and grow. The strategies and implementation of operational excellence are driven by the appointed CEO and management team, board members who are handpicked from EQT’s Industrial Network. Portfolio companies are monitored by more than 120 Investment Advisory Professionals from EQT Partners. EQT´s funds represent the investment of hundreds of investors from all parts of the world.

Funds launched since the beginning of 2012 are managed in the Netherlands, the UK and Luxembourg. EQT Holdings AB, based in Stockholm, Sweden is the parent company of these general partners/fund managers. This means that EQT applies a corporate structure with transparency for all stakeholders, unique in the private equity industry.   

EQT’s mission since its first investment two decades ago remains the same – create value in medium-sized to large companies in Northern and Eastern Europe, Asia and the United States by investing, helping them to develop and transform into great, leading companies.

Tags: