Cevian Boosts Stake in ThyssenKrupp in Bid for Board Seat

Cevian Capital AB, the Swedish investor that seeks to buy undervalued stocks, increased its stake in German steelmaker ThyssenKrupp AG, pressing ahead with a goal to gain a seat on the board that oversees management.

Cevian, based in Stockholm, exceeded the 15 percent threshold that triggers a mandatory disclosure on Feb. 28 and now controls about 15.1 percent, Essen-based ThyssenKrupp said in a statement to the stock exchange today. The purchase underlines Cevian’s “long-term commitment” to the German company, the Swedish investor said in a separate statement.

Cevian’s interest in ThyssenKrupp, whose shares languished as the company posted three years of consecutive losses, first came to light in September, when it disclosed a 5.2 percent holding. Since then it has tripled its stake and hasn’t ruled out buying more of the equities in the next 12 months.

Cevian “aims to achieve representation on the supervisory board of the company commensurate with the size of its shareholding,” ThyssenKrupp said. “The purpose of the investment is not to implement strategic objectives, but to achieve trading gains.”

Chief Executive Officer Heinrich Hiesinger has sold assets and cut jobs as he grappled with a succession of steel-related writedowns and corruption probes that resulted in three executive board members being ousted in December 2012 and the resignation of Chairman Gerhard Cromme in March 2013.

Stock Gain

The stock has gained 11 percent since Cevian’s September disclosure, in which the investor said Hiesinger’s overhaul was starting to take effect. The shares climbed as much as 3.3 percent after Cevian’s disclosure today, and traded up 2.9 percent at 19.52 euros as of 4:20 p.m. in Frankfurt.

ThyssenKrupp was formed in 1999 from the merger of Thyssen AG and Fried. Krupp AG Hoesch-Krupp. Its largest shareholder, the Alfried Krupp von Bohlen und Halbach Foundation, holds a 23 percent stake, according to its first-quarter report.

The foundation didn’t participate in a stock sale by ThyssenKrupp in December, losing the blocking minority it held for decades.

Before it's here, it's on the Bloomberg Terminal.