Activist Cevian Doubles Down on Swiss Finance With Baloise Stake

(Bloomberg) — Activist fund Cevian Capital AB became a major shareholder in Baloise Holding AG, marking its second big investment in the Swiss finance industry after recently taking a stake in UBS Group AG.

The move comes less than a month after the Swiss insurer changed its laws to become more attractive to investors.

Stockholm-based Cevian now holds 3.12% of voting rights in Baloise, according to a disclosure from May 18. The investor is also a major shareholder in the Swiss industrial group ABB Ltd.

Last month, Baloise shareholders abolished a rule curbing voting rights, effectively making the company more attractive for activist investors and takeover bids. Voting rights are now no longer capped at 2% irrespective of the total amount of stock owned by any shareholder.

Read More: Baloise Lifts Voting Restrictions, Opening Door to Activists (2)

Shares of the Swiss insurer edged 0.5% higher on Tuesday following the announcement made over the weekend. The stock is up 16% since the proposal to end the voting rights’ limits was introduced early this year.

Cevian is known for acquiring substantial minority ownership positions in what they see as undervalued companies. The activist investor sees itself as friendly but has a reputation to agitate for bold management actions behind the scenes. It also has a significant track record in insurance.

In 2020 it was an investor in British insurer RSA Insurance Group Plc which was sold to a consortium led by Canada’s Intact Financial Corp., which was the biggest takeover of a listed UK firm that year. Cevian also pushed for a break-up at British insurer Aviva and sold its stake last year.

One of Cevian’s co-founders Lars Forberg is based in Switzerland. The fund joins UBS, Vanguard Group Inc and BlackRock Inc as major shareholders in Baloise.

(Updates with Cevian details from sixth paragraph.)

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