Investor AB (INVE-B) ─ The Swedish Portfolio Linchpin
- J
- Mar 6
- 10 min read
Updated: Mar 7
"To move from one peak to the next, you must first descend into the valley." - Marcus Wallenberg (Former Chairman, Investor AB)
NOTE: Numbers and values are shown in Swedish Krona (SEK) throughout the article, unless stated otherwise.
Introduction and General Background
The origins of Investor AB are intertwined with Sweden's own transformation. In the mid-1800s, Sweden was full of potential yet constrained by a lack of modern financial infrastructure. Ambitious entrepreneurs had big ideas but struggled to access the capital needed to turn them into reality. Enter André Oscar Wallenberg, a young naval officer returning from the United States, inspired and driven by a revolutionary idea.
According to accounts in the Financial Times (2023), a to-the-point book titled "How to Start a Bank" sparked Wallenberg’s ambition. In 1856, he founded SEB, Sweden's very first private bank. Before SEB, obtaining a loan in Stockholm was extremely difficult because it meant dealing directly with the central bank, with little competition or creative financing options available. Wallenberg's thinking was different. He wanted to mobilize small savings from ordinary people and channel that money into industrial development to kickstart the economy. Inspired by a model from Scotland which emphasized pooling small deposits to create a larger, more productive capital base, he believed that getting money circulating was the key to Sweden's growth.
A pivotal moment came in the early 1900s when new banking regulations prevented SEB from holding excessive industrial shares. In response, the growing Wallenberg family spun off these holdings into a separate entity, Investor AB, in 1916 (Investor AB). This decisive move not only safeguarded their growing influence but also laid the groundwork for Investor AB's evolution into a global investment powerhouse that continues to shape industries and drive long-term economic development.
This Swedish investment holding company now boasts over a century of history and serves as the financial backbone of the Wallenberg conglomerate.
Over these past 100-plus years, Investor AB has grown into one of Sweden’s largest public companies by market value, wielding enormous influence on the nation’s economy. To illustrate its longevity, since its IPO in 1919, Investor’s stock has appreciated about 167,000-fold (yes, 167 thousand) including dividends, an astounding ~12.5% compounded annual return over a century. This track record makes Investor AB a household name in Scandinavia’s financial landscape. Key figures in its modern leadership include Jacob Wallenberg (Chairman and fifth-generation family member) and CEO Johan Forssell, who together uphold the firm’s legacy of conservative, long-term stewardship.
Notably, the Wallenberg family’s ownership isn’t just for personal gain. Through their foundations (for example, the Knut and Alice Wallenberg Foundation), a portion of Investor’s dividends (SEK 2.9 billion in 2022) funds scientific research and education in Sweden. This unique arrangement means Investor AB isn’t just another investment company; it’s an institution that balances profit with national purpose.
Investor AB’s background is one of patient capital and principled ownership. With roots in Swedish industrial banking, it evolved into a global investment conglomerate often likened to Berkshire Hathaway for its diversified holdings and steady compounding. Yet it also stands apart through its deep ties to Sweden’s development and the Wallenberg ethos of “long-termism.” This foundation sets the stage for understanding what makes Investor AB such an ever-compelling investment today still.
Understanding the Business and the Unique Value Proposition
What does Investor AB actually own and do?
In short, a bit of everything (and then some).
The company operates as an industrial holding powerhouse with a portfolio spanning dozens of high-quality businesses. These investments are grouped into three areas: Publicly Listed Companies, Patricia Industries, and Investments in EQT.
Publicly Listed Companies
Investor AB holds significant minority stakes in many blue-chip Nordic and global firms.
For example, it owns parts of industrial giants like ABB (automation and robotics), Atlas Copco (engineering equipment), telecom leader Ericsson, pharma powerhouse AstraZeneca,
household appliance maker Electrolux, Nasdaq Inc (the US exchange operator), and of course the original bank SEB.
These are not small stakes.
Ownership often ranges from about 3% up to 35%, and Investor frequently secures board seats. Buying Investor AB stock essentially means getting a slice of a diversified basket of sector-leading businesses all at once, from healthcare to industrials to finance.
Patricia Industries (i.e Private Holdings)
Beyond publicly traded holdings, Investor AB wholly owns or controls a portfolio of private companies under its Patricia Industries division. These include niche market leaders like Mölnlycke Health Care (a global leader in wound care), Permobil (advanced wheelchairs), BraunAbility (vehicle accessibility solutions), Laborie (medical diagnostics), Sarnova (healthcare distribution), Piab (automation), and more. These subsidiaries are often unlisted gems: stable, cash-generative businesses that might otherwise go under the market’s radar. As an owner, Investor AB can drive their growth from behind the scenes and capitalize on their value over time. A prime example is 3 Scandinavia, a telecom operator co-owned by Investor, which covers Sweden and Denmark. These private holdings add a “private equity” style component to the overall portfolio.
Investments in EQT
Investor AB also has a meaningful stake in EQT AB, one of Europe’s leading private equity firms co-founded by the Wallenbergs in 1994. Investor owns roughly 14% of EQT AB and invests in several EQT funds. This relationship offers exposure to a wide range of global private equity and infrastructure investments without Investor AB having to run them directly day to day. Since EQT’s IPO in 2019, its stock has climbed ~230%, benefiting Investor AB as a long-term holder. In total, about 69% of Investor’s assets are listed companies, with the remainder split between Patricia Industries and the EQT stake. By combining public holdings, private holdings, and private equity exposure all in one place, Investor AB creates a unique model that is difficult to replicate.
Why Investor AB is Different
If Berkshire Hathaway is a US-centric conglomerate with insurance float, and SoftBank from Japan is a high-leverage tech venture, Investor AB maintains a more conservative, industrially rooted approach while still aiming for growth via steady expansions and selective private equity involvement. All in all, Investor AB provides a one-stop holding structure, similar to a specialized ETF of top-tier companies, but with the added advantage of active ownership. Its long-term horizon, influential network, diversified assets, and disciplined management create a wide moat in the investment company arena.
Engaged Ownership Model
Unlike a passive index fund, Investor AB takes an active role in guiding its holdings. Board representation, hands-on involvement, and a dedicated drive toward best-in-class standards are central to its approach. The firm’s influence has helped many portfolio companies (such as Atlas Copco, ABB, and AstraZeneca) thrive over decades.
Stable Long-Term Capital
Thanks to the Wallenberg foundations, Investor AB has permanent capital free from short-term redemptions, enabling patient and at times contrarian investing. It typically carries low debt and can afford to be opportunistic during downturns.
Brand and Network
The Wallenberg name and the so-called “Wallenberg sphere” hold significant quality/reputational assurance both in Sweden and abroad, giving Investor AB rich industry relationships that can benefit its companies.
Stock Performance, Valuation, and Financials
Over the last 20 years, the Investor AB stock's total return surpassed +1,500%, turning a SEK 100k initial investment into about SEK 1.6 million. This implies an annualized growth near 15%, exceeding Sweden’s broader market and even outpacing Berkshire Hathaway of the one and only Warren Buffett in the same period.
In 2024 specifically, the total shareholder return (TSR) reached +27%, crushing the comparable SIXRX return index at +9%.
Net Asset Value (NAV): The Key Value for an Investment Company
Net Asset Value, or “substansvärde” in Swedish (literally “substance value”), is a key measure of an investment company’s intrinsic worth. Essentially, NAV is computed by subtracting total liabilities from total assets (i.e., the company's adjusted net assets including the value of the holdings). You then divide that NAV figure by the total number of shares to get a per‐share value, reflecting the underlying economic worth of the portfolio.
If the market price per share is lower than this NAV per share, the company trades at a “discount” relative to its net asset value. Conversely, if the market price is higher than the NAV per share, it is trading at a “premium.” This concept is especially relevant to firms like Investor AB because it reveals whether the stock market currently values the company’s collection of assets (i.e portfolio holdings) at, above, or below the sum of its parts.
Year-End 2024 Financial Summary
(All data from Investor AB Q4 2024 Report, pp.2–5)
Key Indicators (as of end-year 2024) | Value and/or Change |
Adjusted Net Asset Value (NAV), SEK | 969.8bn (317 SEK/share) |
Annual Growth (Adjusted NAV, incl. dividends) | +20% |
Total Shareholder Return (B-share) | +27% |
SIXRX (Comparable Swedish index) | +9% |
Listed Companies Return | +18% |
Patricia Industries Return | +30% (32% excl. cash) |
EQT Investments Value Change | +8% |
Net Debt | 12.2bn (leverage 1.2%) |
Proposed Dividend (2024 fiscal year) | SEK 5.20/share (from 4.80) |
Market Cap (year-end 2024, excl. repurchased) | ~895.9bn |
Such robust figures highlight both the firm’s outperformance relative to the broader market and its conservative financial profile. For example, net debt is minimal at 1.2% of total adjusted assets, meaning the company retains ample flexibility for future expansions or share buybacks should it choose.
NAV Discount: Is It Really Warranted?
Investment holding companies often trade at a discount to net asset value (NAV), but the question is whether Investor AB truly deserves one, given its history and overall quality. Historically, Investor AB’s NAV discount has fluctuated. In late 2023, the discount was higher at roughly 13–15% when the share price was around 233.50 versus a NAV/share of 267 (Investor AB Q4 2023 data).
By year-end 2024, the B-share price reached SEK 292.70, lifting the total market cap (both share classes) to around SEK 895.9bn. In contrast, the adjusted NAV stood at SEK 969.8bn, indicating a NAV discount at year-end of roughly 7%.
As of March 6th, 2025, however, the share price is SEK 316.20, with a total market cap of around SEK 850bn. Put simply, the NAV discount is basically erased at the time of writing.
In comparison, peers like Industrivärden, Kinnevik and others usually see discount ranges in the 10–20% bracket.
However, I believe Investor’s consistent outperformance raises the argument that it might warrant a narrower discount. Several factors reinforce this perspective. Century-long outperformance of about 12.5% annualized over 100-plus years reflects strong results across multiple cycles. Active ownership guided by the Wallenberg family’s stewardship fosters trust and often surpasses what index-based or purely passive holdings can deliver. Philanthropic credibility also plays a role, as part of the dividends fund Swedish research and education, which can bolster stakeholder goodwill. Meanwhile, a stable capital structure with a leverage ratio near 1.2% lowers exposure to credit cycles and reduces overall risk.
Consequently, any market-driven discount can represent a margin of safety for new investors in the stock. The Q4 2024 figures suggest that even at a mild discount, Investor AB remains competitive or superior to many alternative holding firms thanks to its scale, diversification, and conservative financing.
Don't Compare Apples to Oranges When You Use NAV
A steep discount in general is not just a positive, it might also indicate that the market simply believes the company’s leadership does not provide enough hands-on or active additional management value. After all, the NAV is simply the sum of the investment company's parts.
Thus, it is difficult to compare the NAV discount of different Swedish investment companies in a strictly one-to-one manner. Higher or lower discounts in Kinnevik or Industrivärden do not necessarily prove that one is undervalued and the other is overvalued. Instead, such a discrepancy may simply reflect the market’s confidence in each firm’s capabilities, competency, and the outlook of their distinct portfolios.
In that light, it makes more sense to judge a company’s NAV discount against its own historical modern average rather than directly against that of other investment firms. A larger discount over time for one company might simply indicate that investors expect weaker future prospects for that particular firm, or that the market perceives it as having less capable management. When it comes to Investor AB, the important question is whether the fundamentals remain intact, not whether its discount is higher or lower than someone else’s.
An Impressive Balance Sheet
Investor AB continues to carry low net debt relative to total assets. As of December 31, 2024, net debt was SEK 12.2bn, equating to a 1.2% leverage ratio (Investor AB Q4 2024 Report, p.5). The company’s target is 0–10% leverage over a business cycle, allowing it to remain agile during downturns and potentially deploy capital on opportunistic deals. Meanwhile, its reliable cash flow, bolstered by both Listed Companies dividends and Patricia Industries distributions, supports annual dividend increases, historically in the range of 1.5-2% yield. The Board’s proposal for fiscal 2024 is a dividend of SEK 5.20 per share (versus 4.80 last year), a year-on-year increase of about 8%.
My 4 Investment Thesis Fundamentals
The investment thesis is that Investor AB, with its patient capital, diversified holdings, and proven governance, will continue compounding value for shareholders over the long run.
Broad Portfolio of World-Class Companies
Investor AB holds meaningful stakes in many sector-leading players (ABB, Atlas Copco, AstraZeneca, SEB, Nasdaq Inc., and more), plus it fully controls several strong private businesses. This diversity significantly reduces individual company risk while providing wide exposure to global growth.
Consistent Market-Beating Returns
The firm has surpassed benchmarks for decades, showcasing resilience in market downturns and an ability to rebound fast. Its long history of double-digit annual growth suggests a very favourable risk-return profile over time.
Excellent Governance Backed by a Legacy Family
Ownership by the Wallenberg foundations ensures a genuine long-term mindset, with active board engagement and prudent oversight. This structure reduces the chance of detrimental short-term decisions and aligns management interests with outside shareholders.
Solid Financial Position and Dividend Growth
Investor AB’s conservative balance sheet offers flexibility to seize opportunities during corrections. Meanwhile, consistent, growing dividends (historically around 1.5-2% yield) can add steady returns, especially when reinvested.
Final Recommendation
All evidence points to Investor AB as a premier long-term investment that deserves a central place in a portfolio. Its mix of a diversified, top-tier equity basket and hands-on ownership, supported by a century of strong results, speaks volumes. Even if the market occasionally prices the stock at a discount to NAV, I would definitely argue there is a strong case to be made that Investor AB, thanks to its performance, leadership quality, philanthropic alignment, and proven value creation, should trade closer to par or slightly above NAV. This periodic gap between price and intrinsic worth provides an advantage to new buyers looking to build a position over time.
For investors willing to focus on steady growth and compounding, Investor AB checks every box. It is managed by experienced stewards with a successful history of developing global leaders, balancing industrial roots with new technologies, and ensuring stable shareholder returns. By systematically buying more shares, especially if any dips emerge, one can harness both the powerful internal growth of the portfolio and the possibility of a discount narrowing in the future.
Simply put, Investor AB remains a constant buy and hold, with plenty of reasons to believe it will continue to trade near or even above its NAV in the long run, thus reflecting the company’s true value and the leadership behind it. It's a stock you can very much trust over time. This is not to be underestimated from an investment perspective.
By J
References & Sources
Investor AB. (n.d.). Historic returns & company overview. Retrieved March 2, 2025, from https://www.investorab.com
Investor AB. (2024). Q4 2024 year-end report (pp. 2–5, 6, 19–20). Retrieved March 2, 2025, from https://www.investorab.com/investors-media/financial-information-reports/
Wallenberg Foundations. (n.d.). Wallenberg foundations information. Retrieved March 2, 2025, from https://www.wallenberg.com/en/foundations
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