Well, good morning, and welcome to this Telskovco Press Conference and Analyst Meeting. I understand that it's, for some of you, have been quite a busy morning, and I can assure you that it will continue here with the news that we have released today. My name is Hans Stradberg, and I'm the Chairman of the Alfas Copco Group. And to the right of myself, I have Ron De Leighton, President and CEO of Atlas Copco. And to the further right of me, we have Mats Ramstrom, the incoming President and CEO of Atlas Copco.
We have 2 big news from Atlas Copco today. The first one is that Ronny has asked to resign after the AGM 2017. The board has then appointed Mats von Strachm as the person to replace him, And I'll come back to that. Then the second one is the proposal to from the board to split Atlas Copco into 2 parts. And as somebody said here before the meeting, we're so happy with the Atlas Copco we have.
So it's going to be great to have 2 Atlas Copcos in the future. I will start with the appointment of Mats. Mats is today President of the Business Area Industrial Technique, and he is and has been a member of the management team since 2,008. We are very happy that we have found a strong internal Atlas Copco person again for the CEO host. Atlas Copco is well known for being able to grow good leaders, and here is another example.
Mats has a proven track record, and he has great leadership. And he has transformed the Industrial Technique business area organically and through acquisitions in the past. He I can assure you, after 28 years, he knows Atlas Copco's ins and outs to a high degree. Mats, would you like to say a few words?
Thank you, Hans. I wasn't sure what you wanted to
know a little bit, so
I wrote down some notes. But as Hans said, I've been running the business area on Dassault Technique over the last 8 years. And like many other in our group, I've been many years, actually it's 28, so I guess you know that I like it here. I've been able over these years to travel the world to live and work in different positions, And I truly enjoy the industrial environment, everything from the manufacturing to the R and D process. It's really engaging for me.
Meeting with people as well. And normally, when we end our discussion, it's normally how can we do things in an even better way. Now I have a few months, And with some advice from my colleagues here, I've decided that I will take the opportunity to travel a little bit to meet with the different business areas and the divisions and also come out to customers, distributors and really learn a little bit more, even though that I met most of the industrial customers over the years with the power tools portfolio, most of those customers are also customers of compressors and many also for vacuum. I was thinking that maybe I should highlight that Roni runs the company until April 26. He's been a great help to me throughout my career, especially over the last 8 years when we've been working together.
Also very supportive to my team, and it's great to have him next to me over the coming few months.
Thank you. Thank you, Mats. Mats will take on the job from April 27 then, and that is the day after the 1st quarterly report for Atlas Copco has been published and after the Annual General Meeting in 2017. It's too early to say thank you to Ronnie. I'm sure he will run the last part with his Sprinter style here as he has done.
He's a must I'm sure you will. And we're happy for that in the board. He would still be in the lead here. But I want you to know how happy the board is with the fantastic development that has occurred and the extraordinary value creation that has taken place during from its leadership throughout all these years. The group is stronger today than it's ever been.
It has enhanced customer focus. We have built Rodney and his team has built a service business in each of the business areas. And Atlas Copco has also expanded into the, for us, new field of vacuum. So we're very happy with what Roni has achieved. And although I'm not going to thank you today, I'll do that anyway.
First, thank you for your extraordinary achievement. With that, I'd like to go into the second big news for today, and that is the proposal to split Atlas Copco Group into 2 listed companies. One that is Atlas Copco, and that's the industrial part and then NewCo. We don't have a name yet. It would take us some time to develop that.
So when I say new code, don't misunderstand me that that's the new name. That's the working name really. And I want to summarize this, what it is all about in a short presentation here. And then after that, we'll continue with the questions and answers session. So I think you have received this proposal to split Atlas Copco into 2 listed companies in 2018.
As you can see here, this is we're foreseeing 1 industrial part and one that is mining and civil engineering. The rationale for this is really that we see that there are very few synergies between the businesses. Customer base is different between the businesses. And we see also that there are opportunities to develop and create even more value from having dedicated and focused management. We also believe that or see we have seen over the years that the businesses have different demand patterns and also different volatility in the businesses.
And we have now grown the company in such a way that it makes sense to have these 2 businesses stand on their own. As you can see here, this is an illustration of that the two businesses have very limited overlap of customers. With a pro form a calculation or pro form a financials with 12 month backwards, We see that from September 31, we see that revenues would be for Atlas Copco about 70 4,000,000,000 and for the Mining and Civil Engineering, about SEK 28,000,000,000 And you see the profitability there, 20% 16%, respectively. And the number of employees is 33 1,012,000, respectively. So it's the order of magnitude we want to show with this presentation.
Then the an overview of this proposal for how to distribute this. We will have the Atlas Copco AB that will keep its name and be the industrial part. We will split the company during this year and that will divide the company. And then the proposal is to distribute the mining and civil engineering part to the shareholders in 2018. Both will be listed on NASDAQ in Stockholm.
They would be headquartered here in Zikla, both of the companies. And the Matt here will stay as President and CEO of the Atlas Copco Group. Until there is a split, then Mats will be responsible for the full company. I want to underline that. And we will then appoint a new President and CEO for the NewCo Company in time.
We also foresee and propose that the share classes will be kept in A and B shares. An important piece here with such a strong brand name is what's going to happen to that. And there are actually 2 brands that are overlapping. Of course, the Atlas Copco brand and Chicago Numeric. Those Atlas Copco AB will stay as owners of the brands, but we'll be licensing the 2 brands to the new entity.
And of course, we will find a suitable name for the company. Looking at the timetable. January 16 is soon history. I'm not going to go through that. We're announcing here.
And then at the AGM 2017 in April, we will make a short update that there are no decisions that will be taken there. It's for information only. Then during this year, we will create a legal entity for the new coal company and find a name. And then April 24, 2018, there, we will put this to the shareholders of Atlas Copco for them to decide about the split knot. And then in Q2 2018, there will be a new company listed on the Stock Exchange.
And it takes some time, but it's a lot of work that needs to be done. The great thing is that the operations are not overlapping. They are focused, and there are very little synergies between the two entities, while there is, of course, a lot of administrative work, legal work and so on that needs to take place. And with that short summary of this here, I would like to start the questions and answers session. But before we do that, I would like to remind you that we are in a silent period now.
We have the Q4 that we will release on January 27. So no questions related to the results, please. We can't answer that, as you understand. So Hans Ola, would you please help me with the questions?
No, no, not too much. That's okay. Yes. Hello. My name is Hans Ula Mejer.
I'm the CFO of the group. And even though this is not a financial press conference as we normally have every quarter, I'll try to moderate the Q and A session at least for us all. What we will do is we will start with 2 questions, if there are, here in the hall, and then we will alternate with the telephone conference as we normally do. First of all, could you the operator, please, could you repeat the procedure for posing questions on the telephone call? Thank you.
Very good. So we start here in the audience here in Macca. Please go ahead. Please state your name and then both of us. Thank you.
Okay. My name is Dan Lucas, Ameriprise and Partners New Year. I have two questions. One for Mr. Leighton.
Why are you quitting? And the other, will there be any consequences for the employees? Will there be any shedding of jobs?
Okay. I can maybe take both. Yes. Why you're quitting? Of course, I have been doing this job for 8 years.
I was always and proud to allow to do that. I think I had fantastic years since 'eighty five because that's the time I worked for Aperskopco, fantastic years. And this is my company. So I had really fun to do that. But you have to see, and I've said it in a couple of interviews before, if you run leading a company like we do as CEOs, 8 years and beyond that, I think you have to question, okay, does the organization needs a new leader?
So that was for me an area. And second, I think also I felt that and that was also a mission given to me by the Board from day 1. Roni, you have to see that we have options to replace you because something can happen to me. And okay, the company cannot rely on 1 person. So I think I also felt that I have created options for the board to do that.
And if you wait too long, of course, these people are also looking for other options. So either I had to commit to what my Chairman to do another 3, 4 years or I had to do that. And I think this also gave me time now to bike again. So you would see me 10 kilos lighter within a year. And then on the other part, this is definitely and that is very important for everybody to understand.
And of course, we need to explain and all that what we try to do. Like Hans said, we're creating 2 strong companies because that is sorry, because the 2 companies are very strong. If you just calculated the market cap, that will be the 20 largest companies on the stock exchange. So this is not small money that we're talking here. And second, this is a growth project.
So that means that all the people we have today are in the same structure. And also and Hans already had mentioned it, operationally, of course, we work already in our business areas. We work dedicated. We are a product driven, customer focused organization. Of course, legally, financially legally, it's yes, it's organic grown that's been organically growing over the 143 years.
So it is a bit more complex. And that is the reason also why we need to cut. But I don't see any reason for this that we will need to reduce resources.
We have a second question here in the audience.
Yes. Hello. This is Daniel Schmidt from SEB. And just looking at sort of the historical M and A agenda and track record over the past at least 5 years has been very tilted towards the industrial part of the business. That's where you've sort of allocated your money into basically, while the other part has been quite restricted.
Would it be fair to say that the split up of the company is sort of liberating the agenda for also the mining and construction part of the business when it comes to M and A?
Yes. I take that because I'm still responsible for the it's right what you say because we have with with the different type of decisions we have been doing in the industrial technique and also in the whole vacuum part because that has been filled and also a lot of focus has been gone on that part. Of course, when you get dedicated organizations, you will see there will be different opportunities coming. I fully agree that will come. And of course, these companies of these sectors have different return requirements or return levels, which then, I think, when it's dedicated, it will be much clearer to do that.
I think that's an objective. But just to say, I've never just to say that I've never stopped any of the mining opportunity if they were coming, of course, because you also see where in which cycle we have been. We were sometimes too high that everybody says it's crazy. Now it's everybody was a bit scared. So moments may be coming.
Thank you. Thank you. So we take the first two questions from the telephone line, please.
Thank you. Our first question comes from the line of Ben Maysland at Morgan Stanley. Please go ahead. Your line is now open.
Thank you. Good morning, everyone. Firstly, just on the costs of doing this, splitting into 2 companies. Do you have any sense at this early stage on what that will mean in terms of charges or central costs, any tax implications, positive or negative? That's the first question.
Thank you.
Yes, of course, Ben, there are costs. Cooking costs money. But when we were really assessing this split, we looked on that. And I think given the size of the company, I think these are definitely defendable costs on that part. Of course, there are certain tax implications which we have, which I consider in these costs, but they're not from this magnitude that you need to be scared for them.
Thank you. And then on the slides in terms of the strategic rationale, it says that the separation will facilitate fair valuation on the stock market. I just wonder what you meant by that. I mean, do you think parts of the valuation are being mispriced or not reflected in the Atlas Copco share or have been at different points over the last few years or the market's too focused on mining in the context of the group? Just what do you mean by that comment?
Well, I would say that these two entities have different demand patterns. These different Thank you very much for your difficult work. And if somebody wants to buy a mining equipment asset, then they get the big compressor part with it. I think in this case, we free up that so that if you want to own an industrial part, then of course, that will give one valuation, and the other one will be then valued after its circumstances. And I want to underline that here we have 2 world leading companies that we will create.
So we'll see. We have not speculated in what the valuation will be.
Got it. Thank you very much.
Next question, please, from the telephone line.
Yes. Our next question comes from the line of Andreas Willi from JPMorgan. Please go ahead. Your line is now
My first question was similar to Ben on the cost. Maybe you could talk about what the current level of shared costs between the 2 future companies is in terms of infrastructure and so on, what do you expect kind of the running costs, not the separation costs, but the running costs to be higher in the future combined than what they are today So we can take that into account. And the second question, does this plan change or impact your ability or desire or focus of M and A over the next 18 months or not?
Maybe on the cost, I can take it. I think, of course, there are certain costs which, of course, were then asked in the transaction cost that we have. But when it comes to running costs, we have been simulating that one. I think it's not so significant. But and that is something what we have to do in the next coming 12 months, as also the Chairman said, that we need to create the company.
This also gives us the possibility to even focus the company even more and make it, yes, more speedy even on the over let's call it the overhead, which is a CEO and a CFO, now I'm looking at myself, to get that. But we are a very lean headquarters, as you know, that so and we don't see any significant change in that part. Then on M and A, yes, I think what is important now, we have of course, we have plans in the different business areas to do that. And we have a strong balance sheet, and we will also make sure when we do the split, if it is approved by the Annual Meeting and the shareholders in 2018, to make sure that the 2 companies have gun power to go after, yes, different possibilities, either organically or by acquisitions. So there is definitely potential to do that.
Will it happen? There must be 2 to then set the angle. But there is definitely in the Board when we discussed this, we came to the conclusion there is definitely need for more.
Is it right to understand that M and A was not the main driver or focus of this decision in terms of preparing something larger on the mining side?
No, no. That no, no. That is no, don't go into speculation that next month, we will spend here again, and we will have a big acquisition on that one. That is definitely not was never been the driver, never been the driver.
Thank you very much.
Thank you. And we return. Let's see. There was yes, there is a question here in Naka.
Martin Lindgren, direct. The message to split the company comes at the same time as Roni decides to leave. Have you, Roni, been opposing this company's split?
Thank you for giving, Martin, this opportunity because I heard already that some people were thinking, no, this is definitely not I have been actually working on this with my full heart, dedication and see what are the pitfalls, what are the opportunities because I've been leading this company 8 years and even before and see the opportunity, also the complexity. What made me at a certain moment to say this is an opportunity if we do it smart, that part. But it's not one has nothing to do with this is I think it's an opportunity also to do it because now we really will see that we have 2 CEOs with a profile which are really compatible with the future demand because this is a future project. But it has nothing to do with me. You see, I'm still I can still shake hands with my Chairman.
So nothing. And I will not help That's not something right now.
On the contrary.
A follow-up. Will you be the Chairman of NewCo as well, Hans?
That is for the shareholders to appoint me in that case.
But I think it's a good question because for the next coming 18 months, you will be.
Of course, that Yes.
I would be Chairman of the company until if I get reelected 2017, then I would be Chairman of the combined entity. And then after 2018, then of course, there will be 2 companies. And let's not speculate on that.
Thanks.
We
have possibly one more question. If not, I don't see any more hands. So we go to the telephone conference, please.
Thank you. Our next question comes from the line of Markus Almoder from Kepler Cheuvreux. Please go ahead. Your line is now open.
Yes. Hello. Good morning. So I'm just curious if you could say anything about when this process was initiated and was the catalyst behind it starting? And also, who was the initiator behind it?
If you could say anything about it? Also, why is it not put to the vote already now in 2017? Well,
first, it can't be put to the vote in 2017 because you to be able to get the approval from the AGM, you need to and all the implications of it, regulatory, etcetera, you need to have done the split. We have discussed this off and on for some time, and it really this last fall, we more and more started to dwell into what it would mean. I don't think it's a new discussion topic within Atlas. We always and also before us always thought about what is are we the right owners for something? What should the group look like?
Strategically, what directions should we take. So this is something that has grown upon us, and we came to the conclusion that it's the right move to
make. Okay. Thank you.
Next question, please.
Yes. Our next question comes from the line of Lars Blucson from Barclays. Please go ahead. Your line is now open.
Hi, thanks very much. Good morning, gentlemen. First of all, thank you to you, Ronny, for the last 8 years and congrats to Mats. A couple of things from my side. Just first of all on the CEO selection process.
For the industrial business, can you talk a little about the internal versus external process? Was it always a foregone conclusion that Mats would take over? And should we anticipate further changes at the BA or division level on the back of this? And just for NewCo, you obviously announced a new Head of Mining just before Christmas, but you still say, of course, a new CEO still to be appointed for NewCo. Why are you not in a position today to announce a NewCo CEO?
Well, I don't foresee any more changes in BA. Of course, Mats needs to find a replacement for him as Business Area Head of Industrial Technique. Then, of course, we don't have answers to everything, and I don't think we should jump to any conclusions. We have a fine head of the mining business area. Now we're creating a new entity, which will include mining and then the construction tools business and its related services.
And of course, we need to review the situation and search for a CEO without limiting our scope here going forward. So that's about what I had to say at this time. It's not finished yet.
Secondly, if I can ask on Dynapac, and maybe that's more of a question to Hans Ola from the announcement last week. Can you give any or shed any light on where we are in the sale process there? And I just wonder whether you can help us a little bit with where Dynapack is today from a financial performance standpoint, say, relative to the time of acquisition, that would be helpful.
Yes. So I will take it. I will step in from Anzula. First, when it comes to the performance and all that, I think you need to wait a couple of weeks. As the Chairman also said, of course, we are in a closed period.
And I think within 2 weeks from now, we will make our quarter 4 and then also all the details and the reporting because there's a bit of, as you have seen in the communication last week, that we do the reporting a little bit different without road construction. And then you will see all the data, and we try to be as transparent as we can on that one. That, I promise you. When it comes to the process, we are pursuing the different options. I'm not going to say that nothing is going on because that and you know because you have met me several times when you asked that.
And I said, okay, I'm looking for options, whatever it is, but it needs to be better as what we have today. And that is what I am now, together with the team, I'm doing. So let's hope that within a couple of weeks or days or months that we can come out with something very concrete. But when it comes to the figures, I promise you, you will get more detail. Hans Zullo is not hating me, but I think it's Robert worked for his whole team to get the figures all reinstated also for 15% just for comparison reasons.
So we have a further follow-up question here in Macca, and then we go back.
Yes. Martin Lindgren, again. Hans Ola, will you stay with the vacuum and compressor business? Or will you proceed to the new one? And will Niuco have its headquarters in Stockholm?
As I think the
headquarters was on the slide, it will stay here, similar to Atlas Copco. And yes, I will stay with Atlas Copco.
You have a job?
Yes. I realized this morning that I still had a job. Another question here in NatGen.
Danny Schmittingen from SEB. You're doing this exercise with Dynapak, and it's been talked about for some time. So it's not a complete surprise. And you're now splitting Atlas into 2. Do you see any further need to prune either portfolio?
And I guess, especially maybe the mining and construction portfolio going into this new structure?
Of course, it's for the new we never know because portfolio management, I think, companies should always do. And our vision is to be 1st in mind, 1st in choice. What does it mean is to be market leader in the different segments where we are operating. But if we exclude Dynapac in most of our portfolios, what we have, okay, you can always look for very, very small niche, Nishma. I think we are very close to number 1 or number 2, and these businesses contribute to the bottom line.
So because you don't make this type of profitability if you have too many leaks So I at least when you ask me, there is nothing on my agenda, but maybe on the future, you never know. Thank you.
So we can take more questions from the telephone line, and then we come back to Naka.
Thank you. Our next question comes from the line of Andreas Koski from Deutsche Bank. Please go ahead. Your line is now open.
Thank you and good morning. Firstly, on the time plan. I understand it's not possible to let the shareholders decide if this separation should take place already this year. Would it not be possible to create the legal NewCo faster and distribute it to shareholders earlier than almost 18 months from now through an extra AGM?
I think some of us have experience of doing these splits. And I can assure you that it is a lot of work behind the scenes, regulatory tax, legal structure, etcetera. And one thing I can assure you is that we have no intention of holding back. But this is, to the best of our knowledge, and also Hans Ole and the team and Hakan, our Head of Legal, have gone through this. And it matches very much with what other companies are experiencing.
So
I think this is the time you need to do it basically. Yes.
Yes. We would love to do it faster, but we just can't.
You should know, Andreas, we do this in 93 countries. So several many, many different entities like I mentioned. So we should not underestimate the legal and financial work on that.
And Roni, Hans, if I might just add on to that. The time line is, of course, also in connected to how efficiently you can do this separation and split from an economic point of view, from a financial point of view. And we have the full intention to do this in the absolute best way, if I call it like that. And hence, we don't want to rush. So this is an extra element of why we think this is a good time plan actually.
Okay. And then secondly, Harv, do you know if investor is committed to remain a long term shareholder of the NewCo when it's been distributed?
I happen to know that. Yes, they intend to stay an owner as they are today. And they have declared that this is going to the new company is also going to be together with the Atlas Copco part, the continue to be core investment for Atlas Copco. Okay. For investors.
For investors.
Yes, I understood that.
Yes, clearly stated that.
And then lastly, maybe I missed it, but Ronny, do you have any plans what you're going to do when you have left at Copco? Are you looking for or have you already signed for a new operational position? Or will you be
No. Of course, I will for sure, I will stay active. That's for sure. But I promise myself and also at home that I will first finish this because this is more than a full time job. So with my 2 other my other assignment when it comes to Chairman of Electrolux, And then we would see what we'll do.
But I will I would stay definitely active. I will not be a professional biker. So they don't need to worry Vroom doesn't need to worry this year, maybe next year, who knows?
And not a professional board member either.
Yes. I think, of course, we you see in this area, and that is what I have to make up my mind, what I really want to do. And I have not done that because I want to get first this done because this, like I said, this is a full time job. If you want to be a good CEO, and now I'm looking to Mats, this is a 20 fourseven job. And if you do 2 things on the side or you get diluted on focus, you don't get out what it could get out.
And that is I promise and I promise also Hans until there was it, the 26th, 27th, around the middle of the day. So as here was the 1st May, I will keep working on that then, and then we will see. But there is nothing rushed, whatever, that I need to do that.
Okay. Thank you very much.
So with that, we go back to Naka and then back to the telephone line. Yes?
It's Pietro Lardus, Degtencke, Degro Lardus. My question is to the Chairman. Would you have wanted the President's CEO to stay on the job for a longer period?
Yes. Ron has done such a formidable job together with his team that I hate to see him go. The great thing is that we have now Mats. But I also as I was in the same position in 2010, so I can't deny that I also have some sympathy for Ronnie stepping down. So I respect his position, and he has pegged the future for the company in a very good way.
All right.
And a follow-up to Ronny. So was this decision, was it sparked by the decision to divide the company?
No, no, no. Because I think what is important, I think already from day 1, when you take on the CEO and job, and I'm sure also Hans and Mats will talk about that, that you need to think about next. I think that is really professional management. So and that was also what I said to Hans, okay, when the right moment is coming, we would see. And then we of course, you always you talk about that, okay, should we do it?
Should we not do it? Is someone ready? Is the Board ready in all that part, are we ready with projects, is it all go. And I made a commitment to my Chairman and said, I will not do anything what jeopardize after school because this is my company.
So this was the perfect timing then, please?
Yes. Yes. I think for me privately, yes, at the level. So I'm still healthy, fresh things. So okay, happy, so not very good.
And I think it's for Atlas Copco, I think we're showing over and over again that the old saying that the only tradition worth preserving is change. And we're moving forward here, and I think that's the strength of this company.
Thank you. What was Kennedy saying? You should President Kennedy said you should change the roof and the sun is shining. I
guess, where you're putting it.
And we have some more questions, I think, on the telephone line, yes, a handful, at least. So please, we continue.
Thank you. Our next question comes from the line of Guillermo Peineer from UBS. Please go ahead. Your line is now open.
Good morning. It's Guillermo Peigne from UBS. Can you hear me?
Yes.
Okay. Thank you. So first of all, thanks, Roni, and congratulations, Mats. I wanted to ask maybe a couple of questions. First, regarding capital intensity.
Is there a different way of looking at capital intensity between these two businesses or these two new companies going forward, I. E. One will be a little bit more vertically integrated than the other and therefore, an Asset Light business will be more in favor of the Industrial Atlas Copco Businesses and less so for mining? And I have a follow-up later. Thank you.
I think when you look to the balance sheet as such, I think both and if we take new businesses, so 2 businesses, are, of course, also driven by the same asset light concept as we all have been more or less. It's the same. You can say that mining maybe carries a little bit more inventory, but on the other hand, they're a little bit lighter on a couple other parts. So it there's not really significantly big difference. I think, of course, where the difference is in is on the cyclicality.
So where we need to get focus on, and that's what we already have been doing for the last 20, 30 or maybe longer, is on the agility of that part because we all know what mining can do. And then I think what that is I think we have done in both businesses is to strengthen the resilience. If you see what we have been doing also on the mining side, maybe we don't talk so much about that, on the service and the service capabilities, which makes the resilient. You see also during a tough period, which we have which we got on the mining side, the profitability. There are many companies who would like to have this profitability even on the top of their business.
So that is the difference. It's more on the cyclicality and the customer portfolio, which is different. I'll
add to it. Guillermo, you can add to it that from your you will not see too many surprises, I'm absolutely sure, because you have the return on capital employed already in the annual report of the MR business area. And so and that's the big part of the new car, of course. So just to
add You can easily already reconcile it now.
Yes, yes. I agree. And also, obviously, I have to ask then after listening to your answer whether expectations on growth regarding these 2 verticals are different and part of the decision is just basically that. So one of the Atlas Copco stays probably higher growth potential. And one can say that maybe long term, the board and the executive team sees lower growth potential in mining long term?
I would like to meet you within 5 years. We would see. I think it's I don't think we should always look to the environment where it's also the drive internally what is capable of doing it. There is a certain reason why we, as Apopscopco, have now been able to create this type of value. Like also the Chairman said, I think to change, to drive to change, there is always a better way.
I think that has been driven us as a company and also has driven the value creation. So I'm not so sure that I'm in your camp that it will be a big difference.
Last question. Are you staying in Sweden or moving out to lower tax regions maybe?
No, I will move to a higher tax region. As you know, I think I'm a Belgian and also when I moved to Sweden, I kept my place in Belgium. Of course, I will be always connected to this country. And so that is for sure. But we will because during maybe mid of the year, whatever, move back to Belgium.
Thank you very much, and I wish you the best of luck. Thank you.
Thank you. I'm sure you heard about the Hotel California.
Good. So another drink question. We have a few more minutes to go, so we can take more questions from the telephone line.
Thank you. Our next question comes from the line of Peter Trillium from Handelsbanken Capital Markets. Please go ahead. Your line is now open.
Thank you and thank you for taking my question. I guess most questions have been answered. But I reckon the rationale between sort of a pure play into Mining and Civil versus Industrial. But I want to tie on to the former question here on the growth potential. So stability has been the most important for the mining and the, well, civil or construction part of the last period.
Do you think it will be important to also stress the growth function of a specific or isolated stock? You can it's not good to be too volatile from a stock market perspective.
Should I take that one? Yes. No, I think, of course, because now we really are focused on mining, mining. But you also see if you read the document, there's also civil engineering. There are also one in that segment.
And that is, I think, what we have been exploring also. You still we have not gone left, right and center because we could have done that 5, 6 years ago. We could have gone left. We have no, we said no, we are disciplined. And develop the resilience because there is it's not because the mining companies are cyclical that they don't invest even during the tough period, and that is the sectors which we need to develop.
And if you look today to the asset, look to the asset today and you see it is a golden visa.
So do you think there are more interesting niches within civil to sort of take down the mining exposure as such? And a follow-up, I need to ask you. I mean, I hope there will be plenty of opportunities to thank you for your time at Atlas. But I want to take the opportunity to ask you what has been the sort of proudest moment as a CEO over the last 8 years and maybe also share with us what you would like to have done differently.
I think my proudest moment is that I'm allowed to lead this organization. And now we said, now we get fluffy. There's this guy, this tough guy. No, but I think it's really when you are able to lead and see these opportunities coming up and then because you can talk about strategy forever, and you can hire consultants for that and then make you the nicest PowerPoint, but then to execute that. And that, I think, we should not forget.
I think it's the whole execution that is so important. And you had a very, very famous, you switched a very famous skier, right, who said that the more I train, the more luck we have or I have. And that, I think, is my moment of truth. When you look at the result, the bottom line is coming, the cash flow, my cash flow, the golden trail that, that comes that is that you see, okay, our strategy and the execution is great. And that comes with service.
That comes when Mats and I discussed, okay, we go to change the business area scope, and we transform that. And you see it also after 2, 3 years happening. That is really the moment of truth. You see the vacuum is yes, this is but I think it is a group of people do this together.
Okay. And on the civil side, are there issues that could be of interest for a company like Atlas Copco or NewCo in order to limit exposure to mining and get a better balance?
Yes, yes. I think if we were not looking if we were not convinced that there are opportunities, then I think we should not do it.
Okay. Okay. Thank you so much for your answers, and good luck to everybody.
Thank you. We have a couple of more questions, I think, waiting on the call.
Yes. Our next question comes from the line of James Moore from Redburn. Please go ahead. Your line is now open.
Yes. Good morning, everyone. Thanks for taking my questions. Secondly, could you say how you'll capitalize the balance sheets of NewCo? You've got €17,000,000,000 with pension.
And will the adjusted net debt to EBITDA be roughly the same for both companies? Or do you think NewCo needs a different indebtedness? And finally, on the rationale, I wonder whether it would be fair to say that your decentralized models model has faced some challenges as the company has grown, and that's a driving factor behind the decision.
If I start with investors, no, there is no contract. I've never heard about anything like that. They've been around for a while, so I trust them when they say something. And they have stated that they will that both Atlas Copco entities after the split will remain their core investments. And I think that question should be if there are further questions around that, should be posed to investors.
When it comes to balance sheet, maybe, Antoine, you want to Yes.
First, like Hans said initially, of course, first, we are early days on anything, so you can't expect to get too many answers on details. And secondly, we are also in a silent period. So there will be times to refer to current Atlas Copco capitalization when we have the fresh numbers on the plate. That's as much as we can say. But we have, like someone said, a very long time in the eyes of some people to talk about this before it goes to decision.
So we can't comment more on the balance sheet of the 2.
And on
the rationale, if that has some organizational is a result of some organizational implications. Well, you and I, James, we talked about Husqvarna in 2,006, and I think it's a similar issue that this is a well run business that better stand on its own because then there could be more even more focus. It has by no means been mishandled within Atlas Copco. On the contrary, it has grown, as you have seen, tremendously over these 100 years. And we just see that to be more focused, to have a separate Board and separate leadership would benefit the company when it comes to taking the steps from now on.
And this, I'd like to once again underline that these two entities are and will be market leading entities, market leading companies. This is not about spinning off an entity that we don't believe in. On the contrary, these are great businesses, but we believe they can stand on their own going forward.
Great. Thanks very much. Thanks, Hans.
You're welcome. 1 final question because before we have to stop, unfortunately. Take one more question.
Thank you. So our final question comes from the line of Tim Van Marekruchmann from Kemper Capital Management. Please go ahead. Your line is now open.
Good morning. I understand that this is still early days and that you can't give specifics on exactly what kind of leverage metrics the NewCo will have. Nonetheless, are you confident that you'll be able to maintain your current credit ratings when this transaction takes place in the sense that you are losing some, let's say, significant business diversification and size. So would you structure the deal in such a way in terms of putting leverage in the new code that the current a stable rating and outlook that you have at S&P and Fitch will be maintained? Thank you.
Well, if I take Well, if I take that right away, I think your question is understandable, but should be addressed to S and P and the rating agencies. I think it would be presumptuous of us to have a clear answer to that right now. So please let us come back to that, and we'll certainly give full answers to whatever questions you have when the time is right. So but that's the only thing we can say right now. I'm sorry.
Okay. Thank you. Well, with that, I would like to thank you for your interest, and thank you for having tuned in to this the announcements and this discussion. And Ola, I think I hand it over to you. And I would like to thank Ronny and welcome then Mats again.
And thank you, Hans Ole. Great team, as somebody says over the Atlantic, great team. Good.