Investment AB Latour: The Swedish Industrial Empire Builder

I. The Secret Empire Behind the World's Locks and Guards

Picture this: It's a Tuesday morning in Stockholm. Millions of people around the world are unlocking their front doors, checking into hotels, passing through secured office buildings. The vast majority have no idea that behind their locks—whether a Yale deadbolt in Cincinnati, a Mul-T-Lock in Tel Aviv, or an Abloy cylinder in Helsinki—sits the same ownership structure. The same logic applies to the uniformed security guard at your local shopping mall, or the armored truck collecting cash from your neighborhood bank. Trace the capital flows upward, through dual-class share structures and intricate Nordic holding patterns, and you eventually arrive at the same place: a modest office in Gothenburg, Sweden, and a family that most global investors have never heard of.

Investment AB Latour is the investment company that was controlled by the Swedish businessman and billionaire Gustaf Douglas and his family. Through the company, Gustaf Douglas controlled inter alia, security firm Securitas AB and the world-leading lock producer Assa Abloy.

This is not a tech unicorn story. There are no venture capital rounds, no pivot-to-platform narratives, no charismatic founder doing TED talks. This is a 40-year compounding machine built on Swedish engineering, aristocratic patience, and a philosophy so simple it borders on boring: find excellent industrial companies with proprietary products, take board seats, reinvest profits, and wait decades.

The firm prefers to invest in companies for long term with development, manufacture and marketing of proprietary products under their own brands. It prefers to invest in companies with 10 percent average annual growth over a business cycle, 10 percent operating margin over a business cycle, and 15 - 20 percent return on operating capital over a business cycle.

The scale of what Gustaf Douglas built is staggering when you examine it closely. As of December 31, 2024, the investment portfolio consists of ten substantial holdings that had a market value of SEK 89 billion. The wholly-owned industrial operations are grouped into seven business areas: Bemsiq, Caljan, Hultafors Group, Innovalift, Latour Industries, Nord-Lock Group and Swegon. They generate annual sales amounting to approximately SEK 27 billion.

The question we'll unpack is deceptively simple: How did one Swedish aristocrat transform a small investment vehicle into a machine that built global industrial champions?

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II. The Douglas Family: Swedish Aristocracy Meets Harvard Business School

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An Unlikely Billionaire Founder

Gustaf Archibald Siegwart Douglas (3 March 1938 – 3 May 2023) was a Swedish aristocrat, billionaire businessman, and politician. In August 2022, his net worth was estimated at US$7.2 billion.

The word "aristocrat" doesn't fully capture Gustaf Douglas's lineage. His patriline is Scottish, of the Swedish-German branch, descended via two obscure generations, from the youngest son of James Douglas, 1st Lord Dalkeith, ancestor of the 15th century Earls of Morton. All these Douglases were of the Morton branch of the ancient Douglas family. The Douglas family was introduced in the 17th century at Riddarhuset under number 19 among families of comital status.

This wasn't some faded aristocratic family living off old money and titled estates. The Douglas clan had connections that stretched across European power centers. One of his younger sisters is Rosita Spencer-Churchill, Duchess of Marlborough third (and former) wife of John Spencer-Churchill, 11th Duke of Marlborough. Gustaf's other sister, Princess Elisabeth, Duchess in Bavaria is married to Prince Max, Duke in Bavaria and their daughter Sophie is the current Hereditary Princess of Liechtenstein.

Gustaf Archibald Siegwart Douglas was born in Stockholm, Sweden. He was the oldest son of Carl Ludvig Douglas, who was a Swedish nobleman and a diplomat. His father worked as the Swedish Ambassador to Brazil.

Yet for all this blue-blooded heritage, Gustaf Douglas chose an unusual path: he went to business school. And not just any business school—Harvard.

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The Harvard Decision

After an MBA from Harvard Business School in 1964, he worked in Sweden and was CEO of the newspapers Dagens Nyheter and Expressen between 1973 and 1980.

Consider what this meant in the context of 1960s Sweden. Here was a count, literally the oldest son of a diplomat, who could have coasted on family name and connections. Instead, he spent his early twenties studying American business methods—capital allocation, corporate strategy, financial engineering—at the very moment when Swedish industry was beginning its post-war expansion.

Upon his graduation, Gustaf Douglas started his career as a consultant at Bohlin & Stromberg from 1964 to 1968. Next, he was the general manager of TV2 between 1968 and 1971. He got back as the CEO of Bohlin & Stromberg from 1971 to 1972, and was the chairman of the Shareholder's Association between 1971 and 1973.

The media experience is often overlooked in Douglas's biography, but it matters. Running major newspapers in the 1970s taught him something crucial: how to manage complex, cash-generative businesses with strong brands and subscription-like economics. These lessons would later inform his industrial investment philosophy.

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The Investment Philosophy Takes Shape

What emerged from Douglas's early career was a philosophy that would become Latour's DNA: long-term ownership, board-level engagement, and a focus on companies with pricing power from proprietary products.

Douglas obtained an MBA from Harvard Business School in 1964. He served as the CEO of the newspapers Dagens Nyheter and Expressen between 1973 and 1980. After this media tenure, Douglas turned his full attention to building an investment vehicle that could compound capital across generations.

In 2007 he became a member of the Royal Swedish Academy of Engineering Sciences. This wasn't merely an honor—it reflected Douglas's deep engagement with industrial and engineering matters that informed his investment approach.

What made Douglas unusual among wealthy Swedish families was his willingness to combine aristocratic patience with American-style shareholder activism. He didn't want to be a passive investor collecting dividends. He wanted board seats, strategic influence, and the ability to shape his companies' direction over decades.

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III. The Founding: Acquiring a Platform (1985-1987)

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The AB Hevea Acquisition

Latour was founded in 1985 when the Douglas family acquired the majority stake in the listed investment company AB Hevea. Originally, the Douglas family held a significant ownership position in the Skrinet group, where there were other significant shareholders. However, there were different opinions on which assets should be owned and with what perspective. In an agreement with the other owners, AB Hevea could be acquired in exchange for the family's ownership in the Skrinet group.

This transaction deserves close attention because it reveals Douglas's opportunistic brilliance. Rather than starting from scratch—building an investment company from nothing—he engineered a swap that gave him control of a ready-made platform with substantial holdings.

With Hevea came significant ownership positions in, among others, Trelleborg, Boliden, Almedahl-Dahlsjöfors, and 95 percent of the security company Securitas.

That 95% stake in Securitas would prove to be the foundation of everything that followed. But it's worth pausing on what this acquisition represented strategically: Douglas didn't just buy some shares. He took control of a listed investment company, gaining access to public equity markets, institutional relationships, and a diversified portfolio—all in one transaction.

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Gustaf Douglas's Own Words

Excerpt from Gustaf Douglas' book: "At home at the kitchen table, we agreed to try to aim significantly higher. I wanted a listed company as a base for an investment business in industrial companies."

This quote captures Douglas's philosophy perfectly. He didn't want to be a private equity manager doing five-year holds. He wanted a permanent capital vehicle—a listed company—that could compound indefinitely. The "kitchen table" detail is telling: even with aristocratic heritage, Douglas was making these decisions as a family affair, with his wife Elisabeth and eventually his sons.

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Early Portfolio Shaping

In 1987, the company's name was officially changed to Investment AB Latour, reflecting its new direction.

Latour strategically divested holdings such as Boliden in 1986 and Trelleborg in 1993. This willingness to divest is crucial to understanding Latour's model. Unlike conglomerates that accumulate businesses indiscriminately, Douglas was pruning from the very beginning—selling positions that didn't fit his long-term industrial vision to concentrate on what would become the core: security, industrial products, and eventually sustainability-oriented businesses.

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IV. Building the Security Empire: Securitas & ASSA ABLOY (1985-2005)

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The Securitas Transformation

While parts of Securitas were bought up by Group 4, the largest part was taken over by Swedish investment firm Investment AB Latour in 1985.

What did Douglas acquire? A Nordic security company that had been through tumultuous ownership changes and lacked strategic focus.

The holding company Skrinet acquired the company in 1983. Two years later, Skrinet sold Securitas to Investment AB Latour. This new ownership ended a multi-service strategy and refocused our business on security.

Latour, led by Gustaf Douglas, who also became vice-chairman of Securitas, led the company on a dramatic expansion drive beginning in 1988. In the meantime, Securitas's new management, led by Melker Schörling since 1987, had trimmed Securitas's operations, focusing the company entirely on guard and security services. Over its previous decades, Securitas had acquired a number of diversified holdings; these were now sold off, leaving only a core security operation. The newly slimmed down company had sales of less than SKr 1 billion as its acquisition drive began in 1988.

This is the value creation story in miniature: take a diversified, unfocused company, strip it down to its core competency, and then aggressively expand that core through acquisition.

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The Douglas-Schörling Partnership

A critical element of Latour's success was Gustaf Douglas's partnership with Melker Schörling, one of Sweden's most accomplished operational executives.

Melker Schörling (15 May 1947 – 10 December 2023) was a Swedish billionaire businessman. His investment company Melker Schörling AB (MSAB) had large interests in Securitas AB, Assa Abloy, Hexagon AB, Loomis and more. Schörling formed a partnership with fellow billionaire Gustaf Douglas, who was also a major shareholder in Securitas and Assa Abloy.

Melker Schörling was a graduate of the Gothenburg School of Business, Economics and Law. Schörling made a name for himself as the CEO of Securitas in 1987.

This division of labor—Douglas as patient capital provider and strategic owner, Schörling as operational driver—would prove extraordinarily effective. Together, they would build not just one but two global champions.

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The Creation of ASSA ABLOY: A Masterstroke

In that year, the company acquired Assa, a Swedish maker of locks. This 1988 acquisition initially brought the lock business into the Securitas fold.

Assa Abloy was founded at the merger of the two companies Assa and Abloy in 1994. The company was formed in 1994, when Assa AB was separated from Swedish security firm Securitas AB. Shortly thereafter, Assa AB merged with the Finnish high security lock manufacturer Abloy Oy (based in Joensuu, a then subsidiary of the Finnish company Wärtsilä). The company was introduced to the Stockholm Stock Exchange later the same year.

Founders and early ownership of Assa Abloy trace to the 1994 merger when Securitas AB spun off ASSA and combined it with Abloy Oy; control concentrated with Swedish investor Investment AB Latour and Finnish stakeholders from Abloy's Wärtsilä/Metra lineage.

Gustaf Douglas (Investment AB Latour) played a pivotal role assembling Nordic security assets and anchoring early ownership.

The strategic logic was brilliant: rather than have Securitas try to operate both security services and lock manufacturing—two very different businesses—Douglas spun off the locks to shareholders, creating a focused entity that could pursue its own acquisition strategy.

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ASSA ABLOY's Explosive Growth

From a regional company with 4,700 employees in 1994, Assa Abloy has become a global group with 61,000 employees in 2023. The company has grown its revenue by more than 9% annually and operates now in over 70 countries.

Assa Abloy has since made over 300 acquisitions including Yale, Chubb Locks, Medeco in the United States, Mul-T-Lock in Israel and Fichet-Bauche in France.

Over 300 acquisitions. Let that sink in. This is industrial consolidation at an almost unprecedented scale—transforming a fragmented industry of regional lock manufacturers into a global platform. Yale locks, the quintessential American brand? Owned by ASSA ABLOY. Mul-T-Lock, the Israeli high-security pioneer? ASSA ABLOY.

Douglas's business acumen shone in transformative acquisitions, including Securitas in 1985—which he expanded into a global security giant—and co-founding ASSA ABLOY in 1994, where he served as chairman until 2012, steering it to dominance in locks, doors, and access control through strategic consolidations.

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The Power of Dual-Class Shares

How did Latour maintain control through all this expansion? Through a classic Swedish governance structure:

Early structure used dual-class shares: Class A (10 votes) and Class B (1 vote) to maintain a stable control core. Investment AB Latour emerged as the anchor owner, sustaining a long-term control position via voting shares.

Investment AB Latour, controlled by the Gustaf Douglas family, is a cornerstone investor, holding 10.9% of the capital and 29.6% of the votes as of 2024. Their long-standing involvement since 1985 has been instrumental in guiding the company's focus.

This is the Swedish model in action: through dual-class shares, a family can maintain strategic control even as the company grows and issues new equity to fund acquisitions. Critics call it undemocratic; proponents call it the foundation of patient capital.

Between 1985 and 2005, Latour's development was significantly influenced by its holdings in Securitas and ASSA ABLOY. These companies evolved from Nordic players into global leaders, reflecting Latour's growth strategy during this period.

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V. The Transformation: Becoming a Mixed Investment Company (1992-2005)

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The Almedahl-Fagerhult Acquisition

While Securitas and ASSA ABLOY were emerging as Latour's crown jewels in the listed portfolio, Douglas was simultaneously building something else: a platform of wholly-owned industrial companies that would provide cash flow stability and diversification.

Latour's bid for the listed company Almedahl-Fagerhult in 1992 was a significant step in its growth journey. The deal was completed in 1993, in the wake of the Swedish currency crisis, and increased Latour's ownership stake from 38 to 100 per cent. This acquisition marked the creation of Latour's wholly-owned industrial and trading business, which gave the company greater stability through cash flow control. Latour thus became a so-called mixed investment company.

The timing—during the Swedish currency crisis—illustrates Douglas's opportunistic approach. While others were retreating, Latour was acquiring.

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Key Wholly-Owned Acquisitions

Latour acquires the industrial group Swegon, Nobex AB (Nord-Lock AB) and Aneta AB.

These early wholly-owned acquisitions established the template: find industrial companies with proprietary products, strong market positions, and potential for international expansion. Swegon (indoor climate solutions), Nord-Lock (bolt securing systems)—these weren't glamorous businesses, but they had competitive moats and steady cash generation.

The mixed investment company structure gave Latour two engines of value creation: appreciation in its listed portfolio holdings (Securitas, ASSA ABLOY, etc.) and operating profits from wholly-owned subsidiaries. This diversification would prove crucial during market downturns—when listed share values declined, the industrial operations continued generating cash.

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VI. Key Inflection Points: 2005-2015 — Structural Shifts & Spin-offs

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Securitas Spin-offs (2006): Creating Three New Public Companies

If the creation of ASSA ABLOY in 1994 showed Douglas's willingness to separate businesses for strategic clarity, the 2006 Securitas restructuring demonstrated this philosophy at industrial scale.

In 2006, the divisions Securitas Systems (alarm, monitoring, and access control systems) and Securitas Direct (solutions for homes and small businesses) were distributed to the group's shareholders and listed at the Stockholm Stock Exchange.

The Board of Securitas AB proposes to transform three of its divisions into independent, specialized security companies: Loomis Cash Handling Services AB, Securitas Direct AB, and Securitas Systems AB. An Extraordinary General Meeting on September 25, 2006, decides to distribute Securitas Systems and Securitas Direct to shareholders by way of a tax-free dividend. Both are listed on the O-list of the Stockholm Stock Exchange on September 29, 2006.

In 2008, the division Loomis (cash handling) was distributed to the group's shareholders and listed at Nasdaq OMX Stockholm.

Think about what happened here: Securitas, already a global security giant, spawned three additional public companies—Securitas Systems, Securitas Direct (later rebranded Verisure), and Loomis. For Latour shareholders, this was pure value multiplication. Each spin-off received shares in the new entities proportional to their Securitas holdings.

Industry history buffs will remember that both guard firm Group 4 Securicor and access control giant Assa Abloy were once Securitas companies. Both are now multi-billion-dollar entities.

Securitas Direct was later renamed to Verisure in all countries except Spain and Portugal. Today, Verisure is a European leader in home security—another billion-euro business that traces its origins to Latour's strategic decisions.

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The SäkI Merger (2011)

On 6 July 2011 a merger between Latour and SäkI was made, whereby SäkI shareholders received 0.57 Latour B shares for each old SäkI share. In total 28,500,000 new Latour shares were issued.

In 2011, Latour merged with SäkI, its former associate company, consolidating ownership and streamlining governance, while simultaneously acquiring shares in TOMRA, a Norwegian recycling technology firm, to enter the environmental services market.

This merger simplified Latour's corporate structure while simultaneously positioning the company for its next strategic theme: sustainability.

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TOMRA Investment: Entering Sustainability Megatrends

Latour is also the biggest shareholder of the world's largest RVM provider Tomra (with 21.08% of the stock as of July 2021).

"Latour has been the largest shareholder in Tomra since 2011 and we have experienced a strong growth journey. Looking ahead, Tomra is very well positioned for a greener and more sustainable society."

TOMRA—the world leader in reverse vending machines (those devices where you return bottles for deposit refunds)—represented a strategic evolution. Douglas and his team recognized that sustainability megatrends would drive industrial growth for decades. TOMRA is a world leader in sorting and recycling technologies for optimal resource productivity. Tomra was founded in Norway in 1972. Today it has some 110,000 installations in more than 100 countries around the world, and approximately 5,300 employees.

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VII. The Acceleration Era: 2015-2024 — Scaling the Industrial Platform

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Ramping Acquisition Activity

If we include the acquisitions that were finalised in January 2025, we have added annual acquired growth of just under SEK 3 billion during the year. The profitability of all of the acquired businesses is well in line with Latour's other industrial operations. The process of identifying suitable targets continues at an unrelenting pace and we have substantial scope for further acquisitions.

This quote from Latour's 2024 year-end report captures the current phase: aggressive but disciplined acquisition activity, focused on building out the wholly-owned industrial operations.

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Building New Business Areas: The Innovalift Example

Perhaps no recent development better illustrates Latour's platform-building approach than Innovalift—a business area that didn't exist a decade ago.

First up was the acquisition of Aritco Group in 2016, which consisted of Aritco Lift and Gartec. This was followed by the acquisition of Vimec in 2017, TKS Heis in 2019, and finally Motala Hissar in 2021.

At the beginning of 2024, all these companies were consolidated into a new division within Latour Industries under the name Innovalift. With a net revenue of 2.6 billion SEK (pro forma, 2023) and approximately 850 employees, Innovalift took the step out of Latour Industries in 2024 to become its own business area within Latour.

Innovalift AB, was established 2024 as a new business area within the Investment AB Latour, Sweden. With a group of wholly owned leading companies within the lift and elevator industry focused on innovation, quality, design and sustainability we want to develop the possibilities for people to move forward. Today Innovalift consists of 10 companies with focus on designing, manufacturing, and installing vertical and inclined platform lifts, stair lifts, and elevator components.

This is the Latour model in microcosm: start with a platform acquisition (Aritco in 2016), execute bolt-on acquisitions over several years, reach critical mass, and then spin the division out as a standalone business area. The journey from first acquisition to independent business area took approximately eight years.

Investment AB Latour (publ) has, through its wholly-owned business area Innovalift, signed an agreement to acquire 100 per cent of the shares in Arkel based in Istanbul, Türkiye to expand its geographic reach and complement its product portfolio of components for elevators. Arkel is a leading Turkish manufacturer of components for elevators, for both new installations and the growing modernization segment. The company, founded in 1998, manufactures and sells complete control systems, integrated drive units and a broad range of related electronic components for elevators. Net sales amounts to approximately EUR 62 m (pro-forma), of which Türkiye, continental Europe, and India are the key markets. Arkel employs about 410 colleagues and has a profitability well in line with Latour's wholly-owned industrial operations.

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Latour Future Solutions: Venture-Style Sustainability Investing

In 2020, Latour established Latour Future Solutions as a dedicated investment area targeting sustainability-focused growth companies that address environmental, social, and economic challenges, such as resource production, industrial solutions, and circular economy initiatives.

In the second quarter, Latour Future Solutions invested in the Swedish companies Plant and Econans, both conducted through private placements of new shares, with Latour Future Solutions becoming a minority shareholder in the companies.

Latour Future Solutions represents an evolution: minority stakes in sustainability-focused growth companies, more venture-like than Latour's traditional controlling positions. This allows the company to participate in earlier-stage opportunities while maintaining its core industrial focus.

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Recent Strategic Acquisitions (2024-2025)

Bemsiq acquired the Canadian company Armstrong during the fourth quarter, and agreements were signed by Swegon for the acquisition of the German company Howatherm, and by LSAB, within Latour Industries, for the acquisition of the German company HDS Group. Both acquisitions were completed in January 2025.

In the first quarter, Innovalift acquired the German company BS Tableau, Bemsiq acquired 51 per cent of the shares in the Italian company Eelectron, and Nord-Lock Group acquired the Canadian companies Precision Bolting Ltd and Condor Machinery Ltd.

The geographic expansion is notable: Germany, Canada, Italy, Turkey. Latour is systematically building global industrial platforms through disciplined serial acquisition.

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VIII. Generational Transition: The Death of Gustaf Douglas (2023)

Gustaf Douglas died on 3 May 2023.

It is with great sadness that we have received the information that Latour's founder Gustaf Douglas today quietly has passed away. Words can't easily describe what a wonderful and compassionate person Gustaf was. With his genuine interest for the businesses and his ability to express himself, he inspired and engaged employees at all levels in the companies he worked with. Gustaf's success as one of Sweden's great global industrial builders all time is indisputable. His legacy now lives on in all the companies he helped to build, not least through the long-term sustainable corporate culture that now lives on in all of Latour's companies.

The passing of a founder always raises questions about continuity. But unlike many family-controlled companies, Latour had been preparing for this transition for decades.

Douglas and his brother Carl control most of Investment AB Latour, the publicly traded investment company that had revenue of 25.6 billion Swedish kronor ($2.4 billion) in 2023. The Gothenburg, Sweden-based business has stakes in security provider Securitas and Assa Abloy, the world's largest lockmaker.

Of the nine members, six are considered independent in relation to the company and major shareholders, while three are not: Eric Douglas and Carl Douglas, who are tied to the Douglas family ownership, and Johan Hjertonsson, the President and CEO. Eric Douglas has served since 2002 and holds an economics degree, with a background as an entrepreneur since 1992; Carl Douglas joined in 2008.

Both sons—Eric and Carl Douglas—had been on the board for over 15 years before their father's death. This wasn't a sudden succession; it was a carefully managed transition.

The son of billionaire Gustaf Douglas, Carl has sat on the board of the family's investment company Wasatornet for more than a decade. The Douglas family is the largest shareholder of Latour AB, which holds stakes in Securitas AB and Assa Abloy, the world's largest lock producer. Carl is a board member of Latour AB, and is vice chairman of Securitas and Assa Abloy.

Within the Douglas family, the stakes are split among key members as ultimate beneficial owners: Eric Douglas controls 33.32% of the capital and 33.40% of the votes, while Carl Douglas holds 33.04% of the capital and 33.23% of the votes.

Carl Douglas has an unusual profile for a billionaire heir: Douglas is an acclaimed underwater explorer and led the expedition in the Baltic Sea that discovered the warship Sword dating to 1676. Douglas has a wreck-searching company called Deep Sea Productions, which has uncovered several historical finds in the Baltic Sea.

Just three months after Gustaf Douglas's death, another pillar of the security empire also passed: On December 10, 2023, Schörling passed away peacefully at his home in Nyköping, surrounded by his family.

The year 2023 thus saw the departure of both architects of the Securitas-ASSA ABLOY empire. The question for investors: has the corporate culture and strategic framework been institutionalized enough to persist without them?

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IX. Business Model Deep Dive: The Dual Engine

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The Listed Investment Portfolio

Investment AB Latour is a mixed investment company consisting primarily of a wholly-owned industrial operations and an investment portfolio of listed holdings in which Latour is the principal owner or one of the principal owners. The investment portfolio consists of ten substantial holdings with a market value of about SEK 90 billion.

Latour's investment portfolio consists of ten companies where Latour is the principal owner, or one of the principal owners, and where it has a voting power of at least 10 per cent.

The key principle: Latour doesn't do passive index investing. Every listed holding involves board seats and active ownership. This is the antithesis of modern passive investing—Latour takes positions large enough to influence governance, then works to improve operations over decades.

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The Wholly-Owned Industrial Operations

Investment AB Latour's wholly-owned industrial operations are grouped into seven business areas: Bemsiq Group, Caljan, Hultafors Group, Innovalift, Latour Industries, Nord-Lock Group and Swegon. All the business areas are strongly positioned in their respective niches with companies that develop, manufacture and market proprietary products for customer segments that represent considerable and growing international demand. The ambition of growth is high with focus on organic growth and growth through acquisitions. In order to grow at a rate that exceeds overall economic development, the businesses systematically work to strengthen the offer, gain market share in existing markets and increase the international presence. All businesses carry out product development at the forefront, which is essential in order to ensure significant competitive advantages in the future.

The wholly-owned industrial operations are grouped into seven business areas: Bemsiq Group, Caljan, Hultafors Group, Innovalift, Latour Industries, Nord-Lock Group and Swegon. They generate annual sales of just over SEK 28 billion (pro forma).

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Investment Criteria: The 10-10-15 Framework

Latour's investment criteria have evolved but remain anchored in clear financial targets:

It prefers to invest in companies with 10 percent average annual growth over a business cycle, 10 percent operating margin over a business cycle, and 15 - 20 percent return on operating capital over a business cycle.

Growth target: Remains intact, i.e., minimum 10% annual growth of every holding. Profitability target: Revised from minimum 10% operating margin of every holding, to minimum 15% average operating margin across all holdings.

These aren't arbitrary numbers—they represent the profile of companies that can sustain competitive advantages and compound value over decades. The focus on proprietary products is deliberate: such products typically command better margins, face less commoditization, and enable pricing power through brand strength or technical differentiation.

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Financial Performance

The industrial operations' net sales rose 1 per cent to SEK 25,886 m (25,550 m). Adjusted for exchange rate effects, this represents a 2 per cent decline for comparable entities. The operating profit fell 3 per cent to SEK 3,708 m (3,807 m).

The net asset value in Latour increased by 11.0 per cent during the year, adjusted for dividends. The value of our portfolio of listed holdings increased by 14.3 per cent. By comparison, the benchmark index SIXRX increased by 8.6 per cent.

The net asset value at the end of the period was SEK 215 per share compared with SEK 198 per share at the start of the year, which is an increase of 11.0 per cent.

Comments from the CEO: "The past year has been characterised by recession and geopolitical tensions. Nonetheless, the industrial operations have delivered positive growth, and we end the year with a robust fourth quarter, in which profitability was strong and organic growth was reported for both order intake and net sales. Demand remains at a relatively good level, but it is a mixed picture across different geographic regions and sectors. Although the construction and real estate markets are generally subdued, there is an upward investment trend in, for instance, energy efficiency improvements."

The Board of Directors of Investment AB Latour (publ) proposed an increased dividend of SEK 4.60 (4.10) per share which is equivalent to an increase of 12.2%.

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X. Strategic Analysis: The Investment Case

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The Power of the Model

What makes Latour structurally interesting is the interaction between its two engines:

1. Listed Holdings Generate Dividends: The portfolio of listed companies (ASSA ABLOY, Securitas, TOMRA, Sweco, etc.) throws off dividend income that can be reinvested in wholly-owned acquisitions.

2. Wholly-Owned Operations Generate Cash Flow: The industrial businesses generate operating cash flow that strengthens the balance sheet for opportunistic acquisitions during downturns.

3. Active Ownership Creates Value: Board-level engagement in listed holdings means Latour isn't just riding market beta—it's influencing capital allocation, M&A strategy, and operational improvement.

Latour Ab actively engages in the governance and control of its holdings through board participation. This involvement leverages the company's financial strength and industrial acumen to drive sustainable growth and development across its portfolio.

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Myth vs. Reality

Myth: "Latour is just a passive holding company."

Reality: Latour is among the most active owners in Swedish industry. Board seats, nomination committee participation, strategic guidance on M&A—this is engaged ownership at industrial scale.

Myth: "The Douglas era is over."

Reality: Family control remains firm with Eric and Carl Douglas holding combined voting power exceeding 66%. The corporate culture, institutionalized over 40 years, appears deeply embedded across the organization.

Myth: "This is a slow, boring industrial holding company."

Reality: Investment AB Latour (IVTBF) reported a strong order intake increase of 70%, with 10% being organic growth. The company has a robust acquisition strategy, with six acquisitions finalized this year, adding over SEK1.8 billion in net sales annually.

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Applying the Frameworks

Porter's Five Forces Analysis:

• Supplier Power: Low to moderate. Latour's industrial subsidiaries manufacture proprietary products, giving them leverage over component suppliers.

• Buyer Power: Moderate. Many end customers (construction firms, security buyers) have alternatives, but brand strength and installed base relationships create switching costs.

• Threat of New Entrants: Low in mature segments (locks, security guards), moderate in newer areas (sustainability tech).

• Threat of Substitutes: Low to moderate. Physical security (guards, locks) has no obvious digital substitute yet; recycling technology benefits from regulatory tailwinds.

• Competitive Rivalry: Varies by segment. ASSA ABLOY faces rivals like Allegion; Securitas competes with Allied Universal. The key differentiator is scale and geographic coverage.

Hamilton Helmer's 7 Powers:

• Scale Economies: ASSA ABLOY benefits from global manufacturing scale and procurement leverage. Securitas benefits from operating leverage across regions.

• Network Effects: Limited in traditional industrial businesses, though digital access control increasingly shows network effects.

• Counter-Positioning: Latour's permanent capital structure and multi-decade holding periods represent counter-positioning against PE's typical 3-5 year horizons.

• Switching Costs: High in security (long contracts, integrated systems), moderate in industrial products.

• Branding: Strong in legacy brands (Yale, Securitas, Snickers Workwear within Hultafors Group).

• Cornered Resource: Limited. No unique proprietary technology; the advantage is institutional and cultural.

• Process Power: The Latour operational model—decentralized management with centralized capital allocation—represents a form of process power refined over 40 years.

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Key Risks

• Generational Transition Risk: While the succession appears well-managed, family wealth transitions often produce strategic disagreements over time horizons.

• Currency Exposure: As a Swedish company with global operations, currency fluctuations significantly impact reported results.

• Construction Cycle Sensitivity: Several business areas (Swegon indoor climate, portions of Hultafors) are exposed to construction sector cyclicality.

• Interest Rate Sensitivity: The uncertainty is, to some extent, influencing customer investment decisions, leading to longer decision-making processes. This is particularly affecting the project-based operations within Swegon, Nord-Lock Group and Caljan.

• US Tariff Exposure: 11 per cent of the industrial operations' total sales are in the US. Caljan, Hultafors Group, REAC within Latour Industries and Nord-Lock Group have slightly more trade exposure to the US. We have local production to some extent, but the figures also include exports to the US that will be affected.

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Key Performance Indicators to Track

For investors monitoring Latour's ongoing performance, three metrics matter most:

1. Net Asset Value (NAV) Growth vs. Benchmark: The ultimate measure of whether Latour's active ownership model adds value. Compare NAV growth (adjusted for dividends) against the SIXRX Swedish market index.

2. Operating Margin in Wholly-Owned Operations: Target is 15%+ average. This reflects the quality of companies being acquired and operational discipline post-acquisition.

3. Acquisition Activity and Integration Success: Track annual acquired revenue and whether profitability of acquired businesses converges with Latour targets within 2-3 years.

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XI. The Long View: What Investors Should Understand

The Latour story challenges several modern investment assumptions.

First, it challenges the notion that you need to be in Silicon Valley to build multi-billion dollar enterprises. Latour built two global champions—Securitas and ASSA ABLOY—from Stockholm, in industries (security guards and locks) that venture capital would dismiss as "old economy."

Second, it challenges the tyranny of quarterly earnings. Latour's holding periods are measured in decades, not years. The dual-class share structure, whatever its democratic shortcomings, enables this patience by insulating management from short-term shareholder pressure.

Third, it demonstrates the power of systematic acquisition. ASSA ABLOY's 300+ acquisitions weren't random; they followed a disciplined thesis about industry consolidation and scale advantages. Latour's wholly-owned operations follow a similar playbook: platform acquisitions followed by systematic bolt-ons.

The question going forward is whether this model can be maintained without its architect. Gustaf Douglas was born in 1938 and ran Latour for nearly four decades. He built institutional relationships, recruited key partners like Melker Schörling, and instilled a culture across dozens of companies. Can Eric and Carl Douglas—and professional management—maintain this over another forty years?

His legacy now lives on in all the companies he helped to build, not least through the long-term sustainable corporate culture that now lives on in all of Latour's companies.

The Douglas family's 75% ownership stake suggests they're incentivized to try. The portfolio of world-class industrial businesses provides a solid foundation. And the philosophy—proprietary products, active ownership, patient capital—remains as relevant as ever in a world increasingly dominated by short-term thinking.

For long-term investors seeking exposure to Swedish industrial excellence without the volatility of single-company bets, Latour represents something rare: a professionally managed, family-controlled vehicle that has been compounding wealth for four decades across multiple market cycles.

The aristocrat's empire endures. Whether it continues to compound is now up to the next generation.