It is hard to overestimate the importance of the Wallenberg family for Atlas Copco Group’s development. More than once in its 150 years, the company has had to be reconstructed with the help of the family. For many years, the chairperson has also been a Wallenberg. Today’s Wallenbergs still see Atlas Copco as one of their most valuable – and dearest – holdings.
Text by the Centre for Business History in Stockholm
“My relationship with Atlas Copco began when I was about nine years old. That’s when I started to understand what my dad was talking about at home. Atlas Copco was one of the companies closest to his heart.”
Peter Wallenberg Jr., nicknamed Poker, is a fifth-generation Wallenberg. He is the son of Peter Wallenberg Sr., who worked for 21 years in the Atlas Copco Group and then continued as chair of the board for 22 years, until 1996. He remained on the board as honorary chairman until he passed away in 2015. Peter Wallenberg Jr. has himself been a board member since 2012, and his older brother Jacob served on the board for several terms.
An ecosystem that ultimately funds research
Peter Wallenberg Jr. is also chair of the Wallenberg Foundations, one part of the family’s ecosystem of holdings in large Swedish companies. The other part consists of the publicly listed investment company Investor, where the Foundations are the largest owner, and Wallenberg Investment AB, that includes the ownership of the holding companies FAM and Navigare Ventures. It is from these entities that the Wallenberg Foundations’ corporate holdings are managed, including the one in the Atlas Copco Group, where Investor is the lead owner.
The dividend that the Wallenberg Foundations receive from the holding companies is then primarily passed on to fundamental research in Sweden. The Foundations are by far Sweden’s largest private financier of research.
Via the Wallenberg Foundations, the Atlas Copco Group contributes significant amounts to fundamental research. The largest of the foundations is called the Knut and Alice Foundation and was founded in 1917. Incidentally, this was the year that the two Wallenberg-owned companies Atlas and Diesels Motorer merged to form Atlas Diesel.
The Wallenbergs’ engagement in today’s Atlas Copco Group starts with one of Sweden’s first commercial banks, Stockholms Enskilda Bank, which André Oscar Wallenberg founded in 1856. Seventeen years later, in 1873, he helped start his second company, Atlas, which sold equipment to the railway.
When Atlas found itself in dire financial straits 13 years later, loans were granted by the bank to Atlas. The loans were later converted into ownership stakes. This happened again in 1925 and 1934, gradually increasing the family’s ownership every time.
Business and technology in one corporate body
André Oscar Wallenberg and his sons let themselves get more and more deeply involved in Atlas, not only due to their interest in running a business but also so that they could closely follow technology developments. It’s no coincidence that the railcars Atlas started with soon gave way to advanced steam locomotives and tools – and that the company then left those behind to make diesel engines after the merger into Atlas Diesel. Or that the company would transform again and again, leading up to its current form as an internationally successful manufacturer in compressors, vacuum, industrial, and power technologies, under the name Atlas Copco.
For the Wallenberg family, the experiences that Atlas Copco gave them were important, not least the insight into how crises can be overcome for those who succeed in investing in something new, such as technology.
By giving employees a large degree of personal responsibility as well as accountability, Atlas Copco’s customer-oriented and decentralized culture became established. The successes that followed and the rapid international expansion from the mid-1970s solidified the culture, and a credo developed that persistence and long-term commitments always pay off. The family’s ownership practice follows the same path. The Atlas Copco Group has become an example for other companies under the family’s ownership.
The Wallenberg family’s involvement in the company has been both formal and personal. The family has held the chairmanship for 77 of the Group’s 150 years. That is an unusually large number of years, even for a Wallenberg company.
In the family, though, the person with the closest personal involvement in Atlas Copco is Peter Wallenberg Sr. Born in 1926, he chose, unlike previous generations and his brother Marc, to work in industry rather than in the family bank.
In 1953, at 27 years old, he started in the Atlas Copco’s repair workshop in Sickla. He then worked for many years as a salesman. In 1956, he was sent with a secretary, a salesman and a Saab car to the USA to work the American market. He went on to become head of Atlas Copco operations in Rhodesia (today’s Zimbabwe) and later in the UK, among other positions. For the period 1970–1974, he was the Group’s Deputy CEO, and then chair of the board for over 20 years.
During his tenure, Peter Wallenberg Sr. came to personify Atlas Copco. He later applied his deep experience in the global, customer-oriented, and decentralized organization in his role as chair of the investment company Investor.
So it’s no surprise then that Peter Jr. had been hearing about Atlas Copco since the age of nine. “Atlas Copco has always been there. It was the company we talked most about at home, alongside the bank and Investor.”