Wed Sep 18 06:22:00 UTC 2024: ## SKF to Split into Two Companies, Sending Shares Soaring
**Gothenburg, Sweden** – Swedish bearing manufacturer SKF announced plans to split into two separate companies, spinning off its automotive business and listing it on the Nasdaq Stockholm exchange during the first half of 2026. The news sent SKF shares as much as 7% higher.
The move comes after years of struggling to improve margins in the automotive business, which accounts for 30% of SKF’s sales. The remaining 70% of sales are generated by the company’s higher-margin industrial business. Analysts say this split could improve profitability for both operations.
SKF Chair Hans Straberg stated that both businesses are global leaders in their respective fields and will benefit from a clearer focus on their strategies as independent companies.
“The market has been pushing for this move for a while,” said RBC Capital Markets analyst Sebastian Kuenne. “SKF has not been able to structurally improve the automotive margin and it has been diluting the group’s performance.”
The two largest investors of SKF, including Sweden’s Wallenberg-backed FAM and activist investor Cevian, have both publicly stated their support for the decision. Cevian, known for advocating for change in companies they invest in, expects the new automotive company to achieve at least a 10% operating margin, while the remaining industrial-focused SKF could reach a margin close to 20%.
The separation is anticipated to unlock value for both companies, giving them greater flexibility to pursue their respective strategic goals. The move highlights the increasing pressure on companies to optimize their businesses and deliver strong shareholder returns.
First Piper 