Finland and Sweden have much in common, not least when it comes to cross border mergers. Both Laura Lindholm at Munksjö and I have been active in several companies with Finnish - Swedish connections, and we often discussed the opportunities and challenges this brings.
SSAB traces its roots back to the late 19th century, when the Swedish steel industry began on an industrial scale. The modern SSAB was formed in late 1970s through the merger of three local steel producers. The merger took place due to a need for restructuring, greater efficiency and the production of more specialized products. Pretty much the same logic was applied to the combination between Rautaruukki and SSAB. Both companies had for many years strived to increase efficiency and to move toward more advanced products and services. It was clear that the companies could be much stronger together. Also annualized synergies of €150 million were identified.
The acquisition, which was structured as a share exchange offer, was announced in January 2014. Just over six months later, the transaction was completed and Rautaruukki and SSAB combined. In the meantime, the IR teams in both companies had been working in parallel before merging into one IR team later in the fall. The theme "combine the best of both" guided us throughout the merger process. It was critical to have a professional Finnish IR team both to convince Rautaruukki's 40,000 shareholders to accept the share exchange offer, and to deal with all communication formalities during the process.
Since the combination, SSAB's shares have been listed also on Nasdaq OMX Helsinki, and we continue to serve our Finnish shareholders by reporting also in Finnish and meeting frequently both institutional and retail investors in Finland. Now, in the year since the transaction was completed, we have learnt a lot from each other. We have shared best practices between both the two companies and countries. We have been able to realize cost synergies while improving the quality of our communications. The recent market situation is very tough and the rationale for the combination of Rautaruukki and SSAB is even more evident. Our next step is to sharpen SSAB's "equity story" and to constantly challenge ourselves to find even better ways to reach out to the financial market.