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Stenhammer |
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The outcome of OM Gruppen’s bid to take over the London Stock Exchange remained uncertain as Euromoney went to press, but OM’s dynamic founder and chairman, Olof Stenhammar, remained characteristically resolute. “We will go on until the last day [the 60-day bid timetable ends on November 10],” he reported from his car phone between meetings. “We think we have a good case and we will continue to preach its virtues.”
Stenhammar gave up the role of chief executive of OM in 1996 in order to lead Stockholm’s bid to host the 2004 Olympic Games – as well as to give himself more time on his farm and on his boat. However he still owns a 30% stake and has remained consistently vociferous in extolling OM’s virtues, never more so than in the present increasingly bitter Fight for the LSE. The LSE’s robust defence document has sought to undermine OM’s reputation for technological leadership, questioning its capacity to deliver projects on time.
Stenhammar is certainly not invincible, as the failure of the Olympic bid demonstrated (the city was deemed too small, and it did not help that many Stockholmers were seen as being against the proposal). But those putting up the barricades in London will be all too well aware that once this energetic Swede sets his mind on something, he has a habit of getting his way.
So impressive has his career been that whatever happens with the LSE bid, Stenhammar is certain to feature prominently in the history of modern Swedish entrepreneurship.
Olof Stenhammar was born in 1941 on a quiet farm in southern Sweden, where his father (who was born in 1886) had retired after a career in the Swedish army. The youngest of seven children, he enjoyed an idyllic childhood on the farm and went to school locally. He was, he recalls, an enthusiastic sportsman, keen on all kinds of football and a strong swimmer.
After leaving school, he spent four years in the Swedish Royal Navy, where he served on a minesweeper. He is still a lieutenant commander in the Swedish navy reserve, and owns a motor torpedo boat with King Gustav of Sweden, which operates as a museum ship.
In 1966 he decided to go to Lund University. “Unfortunately,” he remembers, “my grades from school were only good enough to get me onto a general degree course.” However, a careful selection of subjects meant that he got the equivalent of an MBA.
While still a student, Stenhammar grew impatient to get started in real business and hit upon the idea of setting up a company specializing in swimming pool construction. Most of his friends, mindful of how short Swedish summers can be, regarded this venture with some scepticism, but it did well enough. “It kept me alive,” Stenhammar recalls. “But most important it was a tremendously useful experience.”
After graduating in 1972, Stenhammar sold his company and moved to the US where his brother- in-law helped get him a job at retail broker WE Hutton in Hartford, Connecticut.
The following year, he became a registered options broker a week after the opening of the Chicago Board Options Exchange, hence acquiring the ground-Floor expertise that would later prove invaluable when he came to set up OM Gruppen in 1984.
He moved to Bache&Co in 1974, and the following year returned to Sweden to become director of a subsidiary of the Bonnier Group that manufactured and distributed swimming pools. His drive and enthusiasm so impressed his bosses that within seven years he was executive vice-president of the entire group, encompassing everything from publishing to ferries.
Stenhammar recalls, though: “After a while I began to feel too far away from operations”. “I was 42 and wanted to do something on my own.” Casting around for an idea, he began to ruminate on how puzzling it was that options had not yet come to Sweden.
In 1984 he founded OM as the world’s First private, for-profit electronic options exchange. “We went all over the US and Europe to try to Find an execution and clearing system,” he recalls. “But we soon realized that we had to do our own thing.” The OM Stockholm Exchange began trading in 1985.
In 1987, OM began selling its trading technology to other exchanges, and in 1989 it launched the OM London Exchange, the First foreign-owned exchange in London.
When the Swedish Stock Exchange demutualized in 1993, Stenhammar began to buy shares. After three years he owned 20%. “At that point I just thought it was a very good investment,” he says. “I had no plans to own it. But then I realized that if we wanted to build a truly integrated trading platform we would have to take it over.”
His ambitions to take over the LSE stem, he says, from the same reasoning. The merger between OM and the SSE occurred on New Year’s Day 1998.
Stenhammar’s interest in taking over the London Stock Exchange was sparked, he says, by his belief that it was getting a bad deal in its proposed merger with Frankfurt’s Deutsche Börse to create iX. “The London exchange has fantastic potential,” he says, “but it has been badly mismanaged.”
Whether shareholders in the LSE decide that OM can provide significantly better management will become clear on November 10. But the chances of the bid succeeding were not helped by the falling share price of OM in October, nor by reports in the Swedish press (repeated in certain British tabloid newspapers) that the Swedish government was considering reopening its investigation into allegations against Stenhammar in connection with the Olympic bid.
For his part, Stenhammar was quoted as saying that he was unaware of any new investigation but that he would welcome it as a chance to clear his name. “I am absolutely confident that my behaviour in the Olympic bid has been clean in every respect,” he says.
