STOCKHOLM, April 27 Swedish investment firm
Kinnevik said on Thursday it has bought an 18.5
percent stake in Swedish cable TV firm Com Hem in a
surprise move that weighed on Kinnevik's share price as it
reported first-quarter results.
"As a big investor within communication and entertainment in
the Nordics ... when this stake was for sale we thought it would
complement (telecoms group) Tele2 and MTG (Modern
Times Group MTG) in our portfolio," said acting CEO
Kinnevik is paying 3.7 billion crowns ($420 million) to the
seller of the stake, NorCell, the indirect investment holding
company of funds advised by private equity firm BC Partners.
"We think Kinnevik is paying a high price," said Swedbank
analyst Stefan Ward, who has a "strong buy" rating on Kinnevik's
shares and a target price of 282 crowns.
Kinnevik's share price was down 3.6 percent at 240.10 crowns
at 1006 GMT, a fall which Ward said was due to the acquisition
as the first-quarter results should have supported the share
"I don't understand why Kinnevik wants a part of Com Hem.
18.5 percent gives them no power and no synergies (with Tele2
and MTG)," said Inge Heydorn, fund manager at Sentat Asset
Management, who holds no shares in Kinnevik or Com Hem.
Com Hem's shares rose 8.6 percent to 110.50 crowns, which
compares with the 110 crowns Kinnevik is payhing Norcell.
"We have a strong balance sheet... after the Com Hem
acquisition we have a leverage of 4 percent (compared with a
target of not exceeding 10 pct of portfolio value), so we have
room for more investments," said Andersson.
($1 = 8.8072 Swedish crowns)
(Reporting by Olof Swahnberg; Editing by Greg Mahlich)