"Melker Schorling, Sweden's Quiet Tycoon With the Midas Touch"

From Fortune:

Much of his success comes from “a good gut feeling for people.”

Business tycoon Melker Schorling, one of Sweden’s most prominent investors, says he is well-positioned to expand his 60 billion crown ($7 billion) investment empire even as he prepares to hand over affairs to his daughters.

MSAB, the holding company he set up in 1999 which spans a diverse set of companies from measurement technology to locks and guards, has consistently outperformed larger rivals.

Investors attribute Schorling’s success to a knack for picking small specialists which go on to become global market leaders.

In a decade, MSAB has had returns of over 500%, outperforming rivals such as Wallenberg-backed Investor AB and Industrivarden and leading Swedish media to dub Schorling “King Midas” of the Stockholm bourse.

MSAB investors include H&M chairman Stefan Persson and BP & AB Volvo Chairman Carl-Henric Svanberg.

But while Schorling’s path to success has had few bumps, some analysts are beginning to question the future of the group which has not made a single new investment in a decade.

Schorling turns 70 next year and although his daughters have become more involved they have not yet stepped into high-profile executive roles, and he recently lost one of his closest team members, MSAB CEO Ulrik Svensson, who leaves at year-end to join Lufthansa as CFO.

Svensson’s departure raises some questions about the group’s direction and stability, analysts say.
Schorling, who shies away from media appearances, is not planning major changes.

“We are very long-term oriented and it is highly likely that our holdings will be the same for many years to come,” he told Reuters in an email.

But opportunity may be on the horizon for MSAB which has six listed companies like Assa Abloy, the world’s biggest maker of locks, Securitas, the world’s second-biggest provider of guards, and Hexagon, market leader in precision measurement technology.

“For the time being we have actually divested a bit from our holdings to make sure that we have enough dry powder for future investments,” he said. “Valuation multiples are high at the moment and we believe there could be interesting investment opportunities in the future.”

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