Investor AB Year-End Report 1998

Business Wire, Feb 11, 1999

STOCKHOLM, Sweden--(BUSINESS WIRE)--Feb. 11, 1999-

- In 1998, the total return for Investor's shareholders was -1

percent, compared with a 13 percent average for the Stockholm

Stock Exchange as a whole.

- Among Investor's main holdings, shares were acquired for a net

amount of SEK 5,016 m. Of this total, SEK 1,785 m. pertains to

shares in ABB, SEK 1,566 m. shares in Astra and SEK 992 m. shares

in Ericsson.

- A broadening of ownership in Saab AB was carried out during the

year. Investor now owns shares corresponding to 20 percent of the

capital and 36 percent of the voting rights in the company. Saab

AB's shares were listed on the Stockholm Stock Exchange in June

1998.

- The Group's net income for 1998 amounted to SEK 3,465 m. and the

Group's net debt was SEK 15,966 m. at year-end.

- On December 31, 1998, the value of Investor's main holdings was

SEK 88,923 m. The value of the main holdings appreciated by 1

percent in 1998. The corresponding value on February 3 was SEK

93,775 m.

- On December 31, 1998, Investor's net asset value was SEK 93,502

m., or SEK 467 per share. On February 3, net asset value was SEK

99,854 m. or SEK 499 per share.

- The proposed ordinary dividend to shareholders is SEK 11.00

(10.00) per share. A 4:1 split is also proposed.

The year-end report can also be accessed on the Internet at

www.investor.se

Year-End Report 1998

Investor's total return for the full year 1998 amounted to -1.1 percent, compared with 13.0 percent for the Stockholm Stock Exchange(1). Investor's net asset value(2) amounted to SEK 93,502 m. on December 31. This corresponds to SEK 467 per share after full conversion. On February 3, net asset value amounted to SEK 99,854 m., corresponding to SEK 499 per share.

Comparative figures for the previous year do not include Saab AB. The Investor Group's income before tax, not taking unrealized value appreciation into account, amounted to SEK 3,711 m. (3,903). Net income amounted to SEK 3,465 m. (3,996).

Interest-bearing liabilities increased by a total of SEK 3,098 m. during the year and the Group's net debt at year-end 1998 was SEK 15,966 m. compared with net debt of SEK 8,011 m. at December 31, 1997. At year-end 1998, all debts between Investor AB and Saab AB had been replaced by external financing.

Investor's Main Holdings

In 1998, purchases of shares totaled net, SEK 5,016 m.

The largest purchases are broken down as follows: SEK 1,785 m. in ABB, of which SEK 1,239 m. pertains to acquisitions through call options distributed by Gambro; SEK 1,566 m. in Astra; SEK 992 m. in Ericsson; SEK 762 m. net in Electrolux; and SEK 291 m. in Atlas Copco.

Shares in OM Gruppen were sold, providing a capital gain of SEK 577 m. Most of this sale pertains to the shares sold within the framework of the option agreement concluded with Svenska Handelsbanken, ForeningsSparbanken and Merita-Nordbanken in November 1997 as part of the agreement to merge OM Gruppen and the Stockholm Stock Exchange.

As reported earlier, a broadening of ownership was carried out in Saab AB during the year, whereby Investor AB concluded an agreement in April with British Aerospace plc on the sale of shares corresponding to 35.1 percent of the capital and 35.0 percent of the voting rights in the company. In addition, in May, Investor's shareholders were offered the opportunity to acquire, through the exercise of purchase rights, 44.8 percent of the share capital and 29.0 percent of the voting rights in Saab AB. Saab AB's shares were then listed on the O-list of the Stockholm Stock Exchange in June.

In total, this transaction provided Investor with SEK 3,500 m. in payment from British Aerospace and an amount of SEK 2,137 m. as a result of the offering regarding the sale of shares in Saab AB, directed to Investor's shareholders. The broadening of ownership had a positive impact on shareholders' equity in Investor of SEK 2,873 m., of which SEK 2,115 m. is reported in the income statement as a capital gain attributable to the sale of shares to British Aerospace, and SEK 758 m. in shareholders' equity. The amount reported directly in shareholders' equity corresponds to the difference between the payment received and the book value of the shares in Saab AB that were sold to Investor's shareholders.

During the year, dividends received by Investor from its main holdings increased and amounted to SEK 1,841 m. (1,683). The 1997 figure includes, in addition to cash dividends amounting to SEK 1,637 m., the value of shares in Granges received by Investor through the holding in Electrolux.

1) Total return refers to the sum of share price appreciation and

dividends

2) Saab Automobile is reported at book value of subordinated loan at

year-end. -0-