'Orrefors Kosta Boda becomes center for crystal in 'Royal Scandinavia'
A Scandinavian art and design company will be created with Royal Copenhagen and Orrefors Kosta Boda as its base. The new company, which will be called Royal Scandinavia, will be a strong international design group for porcelain, crystal and silver. The crystal business will be coordinated from Orrefors Kosta Boda, in Småland, thereby giving it new opportunities to further develop its operations. Royal Copenhagen will be a leader in porcelain and Georg Jensen in silver.
A coordinated presentation of these individually strong quality brands creates better resources and considerably strengthens export opportunities. With their unique Scandinavian design and fine craftsmanship, these products target the same quality-conscious consumers around the world.
Royal Scandinavia will have long-term Swedish ownership of at least 20 percent. The majority owner Carlsberg will over time reduce its ownership interest in Royal Scandinavia in order to diversify the new company's ownership base. In addition to a listing on the Copenhagen Stock Exchange, Royal Scandinavia is also considering listing its share on the Stockholm Stock Exchange.
To bring about this solution, the owners of Orrefors Kosta Boda have reached the following agreement:
Scandinavian Equity Partners (SEP), which currently owns 64 percent of Orrefors Kosta Boda, is selling its interest to Royal Copenhagen (which currently owns 36 percent) in return for both newly issued shares in Royal Copenhagen and cash. A proposal to change the company's name to Royal Scandinavia will be voted on at the next annual general meeting. Orrefors Kosta Boda will become a wholly owned subsidiary of the new Royal Scandinavia Group.
In the process, Carlsberg, is reducing its interest in Royal Scandinavia from 83 to 64 percent. SEP will own 6 percent of the new company, which will also have a new Swedish owner in the form of companies representing the interest of Dr. Hans Rausing's family, which, by acquiring shares from Carlsberg, will own 14 percent of the new art and design group. The remaining shares are spread on the Copenhagen Stock Exchange. SEP and the companies representing the interest of the Hans Rausing family have signed a mutual agreement on the pre-emptive right to acquire each other's shares in the event of a sale, to ensure long-term Swedish ownership of at least 20 percent.
The new president appointed at Orrefors Kosta Boda is Olle Marköö, currently the president of BodaNova - Höganäs Keramik. During his seven years as BodaNova's president, sales have quadrupled. Olle Marköö, who is 38, is a Master of Science with a major in industrial economics.
The new art and design company will continue to strengthen its position on its home markets in Sweden and in Denmark and the cooperation with its dealers will be intensified. In its future export endeavors the company will build on the successful cooperation between Swedish crystal and Danish porcelain and silver established a year ago. Orrefors Kosta Boda will be the center for crystal operations, where the focus will remain on design. Thus, the crystal business will be coordinated in the province of Småland, and it will include the Danish manufacturer Holmegaard.
Flemming Lindelöv, president of Carlsberg, comments as follows: "We are convinced that combining the best of Swedish and Danish design is the right move, and we see many new, exciting opportunities with the cooperation. We will reduce our interest in Royal Scandinavia to achieve a broader base of ownership, although we will remain a significant long-term shareholder of the new company. Royal Scandinavia will have our full support in its future international endeavors, including through its own stores."
"After a period of turbulence and uncertainty concerning the long-term ownership of Orrefors Kosta Boda, we are very happy to have been able to create this industrially exciting solution," says Gösta Bystedt, chairman of Scandinavian Equity Partners. "We are convinced that it will strengthen the opportunities available to these brands to expand internationally."
"With international competition on the rise, it is a great strength to be able to present together such outstanding, quality brands as Orrefors, Kosta Boda, Royal Copenhagen and Georg Jensen," says Leonhard Schröder, future president of Royal Scandinavia (currently president of Royal Copenhagen). "Together they form a palette of individually strong brand names with good product ranges created by Scandinavia's best artists. We will now have the opportunity and resources to broaden and intensify our export efforts."
For more information, please contact:
Conni Jonsson, president of EQT Partners Phone: +46-8-440 5301
Leonhard Schröder, president of Royal Scandinavia Phone: +46-481-34 00
Henrik Källén, president of Orrefors Kosta Boda Phone: +46-481-34 00
The Carlsberg Group is one of the world's major international breweries, with revenues of approximately SEK 20 billion. Around 85% of its beer sales are outside Denmark. International brewery operations include beer exports and local production in just under 70 locations in 40 countries. The group includes affiliated operations that employ around 18,500 people and market their brands in around 150 markets.
Scandinavian Equity Partners (SEP) is an investment company that acquires Northern European companies with development and earnings growth potential. SEP, which is owned by Investor, AEA and S-E-Banken, has over SEK 2.9 billion in risk capital. With the help of its investment adviser, EQT Partners AB, SEP has acquired - wholly or partly - interests in Orrefors Kosta Boda, Brukens Nordic AB, Sabroe Refrigeration A/S, Perlos Oy, Duni AB and Flexlink AB.
Royal Copenhagen in 1995/96 had revenues in the art industry of approximately SEK 1,400 million and approximately 1,870 employees. The company's crystal, porcelain and silver products are manufactured in Copenhagen, Naestved, Hjörring and Kolding. Royal Copenhagen, which has its own sales organization in all major markets, operates an international retail chain comprising around 80 of its own Royal Copenhagen and Georg Jensen stores in major cities around the world.
Orrefors Kosta Boda designs, manufactures and markets glassware, decorative crystal and art glass with strong brand names and the highest quality. Revenues in 1996 amounted to SEK 664 million, with around 1,000 employees. Manufacturing is done at six glassworks in Småland. Sales companies are located in the U.S., Australia and Japan. Other sales are handled through agents and distributors in 30-odd countries around the world.
The new company Royal Scandinavia will have revenues of approximately SEK 2,100 million and 2,900 employees.