Subversive technology has major implications for a wide range of listed companies. But who will be the winners and losers, and is far from given.
share price in cash handling company Loomis raged 17 per cent last week when the two main shareholders – Gustaf Douglas investment company Latour and Melker Schörling MSAB – dumped all of its limited voting B shares.
to market players reacted strongly is understandable. Admittedly retains both its main shareholders voting A shares. But the signal is that Douglas and Schörling on the way out, after three decades supported Loomis, first as a part of Securitas, since 2008 as an independent listed company.
- We simply wanted more dry powder the day it can look completely different on the stock exchange, said MSAB’s CEO Ulrik Svensson News Agency Direkt in connection with the sale.
Loomis has risen about 140 percent in the past five years, while the market as a whole is just above zero. So the timing is reasonable. But why sell at all? What does Douglas and Schörling market yet to be discovered? It can only speculate.
One hypothesis is that Loomis’ core business – handling and movement of cash – is threatened. In Sweden, the total value of all banknotes and coins decreased by a third since 2007. Short- and mobile payments quickly takes over. It is one of many examples of what is called disruptive technology , often digital innovations that change the rules of the game for an entire market.
the Swedish stock market are numerous examples of companies that lost out on the technical development. Envelope manufacturer Bong Ljungdahl has been hit hard as people and companies sending fewer physical letters. Eniro’s existence was threatened when people stopped using the telephone. The media company MTG is under structural pressure as distribution monopoly in practice broken by the streaming network services. Even Comhem suffer more and more cuts TV cable and connect to fiber networks in place, where the customer can choose from several different operators.
Web-based betting company Betsson, Unibet and Net Entertainment is taking market share from traditional operators Swedish Games. Residential Rental Sites like Airbnb steal shares from the hotel industry, which affects the Swedish listed Scandic and Rezidor as well as hotel property company Pandox.
Of paramount importance to Sweden and Stockholm Stock Exchange is the development of engineering sector in general and the automotive industry in particular. And top executives from the world’s largest vehicle manufacturers agree that the automotive industry is facing major changes over the next decade.
The problem is that the realization lingered far too long. Only when the search engine giant Google in 2009 showed self-driving cars marked the start of the sleepy automotive industry. Behind the facades lurk even Apple with the mysterious Titan project, as well as Baidu, China’s equivalent of Google. Although it is already subversive American car service company Uber has projects with self-driving cars.
Driverless cars have huge benefits in terms of lower environmental emissions, less congestion , better fuel efficiency and a significant reduction in the number of traffic accidents. Along with the growth of car sharing can reduce car sales dramatically.
The traditional carmakers risk falling behind in the value chain and become more of subcontractors bucks plate. The actual values are created instead of the producers of software, for example, monitoring, control and battery technology for electric cars. The risk has increased in companies like Autoliv, Haldex and other automotive-related companies.
There are of course plenty of winners on the technical development . 3D-printing company Arcam is one such. The company has already received a volume order for its 3D machine for the aviation industry.
Investment bank Credit Suisse recently published The Age of Disruption that’s just how disruptive technologies affecting global stock markets. Some of the conclusions is that the company behind the new disruptive technology will not necessarily be the final winner. Similarly, the companies are exposed are not always the losers.
How is it, for example by Loomis old parent company Securitas? Technological solutions are expected to replace more and more security guards. While Securitas invests heavily in technology development. Who knows, maybe the company is the market leader in rationalizing away its own core business?
Speaking Loomis performed at Gunnebo security group CEO Henrik Lange, a bright image the cash market’s future at last week’s Capital. He sees great growth opportunities in cash and believe that digital solutions primarily strikes out card payments, rather than physical cash. Osvuret is best.
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