Obbligazione SKB 0.875% ( XS2079107830 ) in EUR

SKB

93.22 EUR ▲

Svezia

XS2079107830 ( in EUR )

0.875% per anno ( pagato 1 volta l'anno)

14/11/2029

Prospetto opuscolo dell'obbligazione SKF XS2079107830 en EUR 0.875%, scadenza 14/11/2029

15/11/2025 ( In 190 giorni )

SKF è un'azienda globale leader nella progettazione e produzione di cuscinetti volventi e soluzioni di ingegneria correlate.

The Obbligazione issued by SKB ( Sweden ) , in EUR, with the ISIN code XS2079107830, pays a coupon of 0.875% per year.
The coupons are paid 1 time per year and the Obbligazione maturity is 14/11/2029

AKTIEBOLAGET SKF
(a public company incorporated with limited liability in Sweden)
300,000,000 0.875 per cent. Green Notes due 15 November 2029
Issue price: 99.848 per cent.
The 300,000,000 0.875 per cent. Green Notes due 15 November 2029 (the Notes) will be issued by Aktiebolaget SKF
(the Issuer) on 15 November 2019 (the Issue Date).
The Notes are subject to redemption at the option of the Issuer, as further described in "Conditions of the Notes 
Redemption and Purchase Redemption at the Option of the Issuer". Also, the Issuer may, at its option, redeem all,
but not some only, of the Notes at any time at par plus accrued interest, in the event of certain tax changes as described
under the Conditions of the Notes. The Notes mature on 15 November 2029.
This Prospectus has been approved as a prospectus by the Commission de Surveillance du Secteur Financier (the
CSSF), as competent authority under Regulation (EU) 2017/1129 (the Prospectus Regulation). The CSSF only
approves this Prospectus as meeting the standards of completeness, comprehensibility and consistency imposed by the
Prospectus Regulation. Approval by the CSSF should not be considered as an endorsement of the Issuer or of the
quality of the Notes. Investors should make their own assessment as to the suitability of investing in the Notes. The
CSSF assumes no responsibility for the economic and financial soundness of the transactions contemplated by this
Prospectus or the quality or solvency of the Issuer.
Application has also been made to the Luxembourg Stock Exchange for the listing of the Notes on the Official List of
the Luxembourg Stock Exchange and admission to trading on the Luxembourg Stock Exchange's regulated market.
References in this Prospectus to Notes being listed (and all related references) shall mean that such Notes have been
admitted to trading on the Luxembourg Stock Exchange's regulated market and have been admitted to the Official List
of the Luxembourg Stock Exchange. The Luxembourg Stock Exchange's regulated market is a regulated market for the
purposes of Directive 2014/65/EU.
This Prospectus (as supplemented as at the relevant time, if applicable) is valid for the admission to trading of the Notes
on the regulated market of the Luxembourg Stock Exchange until the time when trading on such regulated market
begins. The obligation to supplement this Prospectus in the event of a significant new factor, material mistake or
material inaccuracy does not apply once the Notes are admitted to trading on the Luxembourg Stock Exchange.
The Notes have not been and will not be registered under the United States Securities Act of 1933, as amended (the
Securities Act) or with any securities regulatory authority of any state or other jurisdiction of the United States. The
Notes are being offered and sold outside the United States in accordance with Regulation S under the Securities Act
(Regulation S), and may not be offered and sold or delivered within the United States or to, for the account or benefit
of, U.S. persons (as defined in Regulation S), except pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act.
PRIIPs Regulation/Prohibition Of Sales To EEA Retail Investors - The Notes are not intended to be offered, sold or
otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the
European Economic Area (EEA). For these purposes, a retail investor means a person who is one (or more) of: (i) a
retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, MiFID II); or (ii) a customer
within the meaning of Directive (EU) 2016/97 (the Insurance Distribution Directive), where that customer would not
qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II. Consequently no key information
document required by Regulation (EU) No 1286/2014 (as amended, the PRIIPs Regulation) for offering or selling the
Notes or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or
selling the Notes or otherwise making them available to any retail investor in the EEA may be unlawful under the
PRIIPs Regulation.
MIFID II product governance / Professional investors and eligible counterparties only target market Solely for
the purposes of each manufacturer's product approval process, the target market assessment in respect of the Notes has
led to the conclusion that: (i) the target market for the Notes is eligible counterparties and professional clients only, each
as defined in MiFID II; and (ii) all channels for distribution of the Notes to eligible counterparties and professional
clients are appropriate. Any person subsequently offering, selling or recommending the Notes (a distributor) should
take into consideration the manufacturers' target market assessment; however, a distributor subject to MiFID II is
responsible for undertaking its own target market assessment in respect of the Notes (by either adopting or refining the
manufacturer`s target market assessment) and determining appropriate distribution channels.
The Notes will be rated Baa1 by Moody's Deutschland GmbH (Moody's) and BBB+ by Fitch Ratings Limited (Fitch).
In accordance with Moody's ratings definitions available as at the date of this Prospectus on

https://www.moodys.com/ratings-process/Ratings-Definitions/002002, obligations rated 'Baa' are judged to be medium-
grade and subject to moderate credit risk and as such may possess certain speculative characteristics. In accordance with
Fitch's
ratings
definitions
available
as
at
the
date
of
this
Prospectus
on
https://www.fitchratings.com/site/definitions?rd_file=ltr#str, an obligation rated 'BBB' indicates that expectations of
default risk are currently low; the capacity for payment of financial commitments is considered adequate, but adverse
business or economic conditions are more likely to impair this capacity. Moody's and Fitch are established in the
European Union and are registered under Regulation (EC) No. 1060/2009 (as amended) (the CRA Regulation). As
such Moody's and Fitch are included in the list of credit rating agencies published by the European Securities and
Markets Authority on its website (at http://www.esma.europa.eu/page/List-registered-and-certified-CRAs) in
accordance with the CRA Regulation. A security rating is not a recommendation to buy, sell or hold securities and may
be subject to suspension, reduction or withdrawal at any time by the assigning rating agency.
The Notes will initially be represented by a temporary global note (the Temporary Global Note), without interest
coupons, which will be deposited on or about the Issue Date with a common safekeeper for Euroclear Bank SA/NV
(Euroclear) and Clearstream Banking S.A. (Clearstream, Luxembourg). Interests in the Temporary Global Note will
be exchangeable for interests in a permanent global note (the Permanent Global Note and, together with the
Temporary Global Note, the Global Notes), without interest coupons, on or after 25 December 2019 (the Exchange
Date), upon certification as to non-U.S. beneficial ownership. Interests in the Permanent Global Note will be
exchangeable for definitive Notes in bearer form, serially numbered in the denomination of 100,000 and integral
multiples of 1,000 in excess thereof, up to and including 199,000, each with Coupons attached on issue, only in
certain limited circumstances - see "Summary of Provisions relating to the Notes while represented by the Global
Notes". No Notes in definitive form will be issued with a denomination above 199,000.
An investment in Notes involves certain risks. Prospective investors should have regard to the risk factors
described under the heading "Risk Factors" on page 6.
Joint Lead Managers
Deutsche Bank
Nordea
SEB

The date of this Prospectus is 13 November 2019

This Prospectus comprises a prospectus for the purposes of Article 8 of the Prospectus Regulation. When
used in this Prospectus, Prospectus Regulation means Regulation (EU) 2017/1129.
The Issuer accepts responsibility for the information contained in this Prospectus. To the best of the
knowledge of the Issuer (having taken all reasonable care to ensure that such is the case) the information
contained in this Prospectus is in accordance with the facts and does not omit anything likely to affect the
import of such information.
This Prospectus is to be read in conjunction with all documents which are deemed to be incorporated herein
by reference (see "Documents Incorporated by Reference"). This Prospectus should be read and construed
on the basis that such documents are incorporated and form part of the Prospectus.
Other than in relation to the documents which are deemed to be incorporated by reference (see "Documents
Incorporated by Reference"), the information on the websites to which this Prospectus refers does not form
part of this Prospectus and has not been scrutinised or approved by the CSSF.
Save for the Issuer, no party has independently verified the information contained herein. Accordingly, no
representation, warranty or undertaking, express or implied, is made and no responsibility or liability is
accepted by the Joint Lead Managers as to the accuracy or completeness of the information contained or
incorporated in this Prospectus or any other information provided by the Issuer in connection with the
offering of the Notes. No Joint Lead Manager accepts any liability in relation to the information contained
or incorporated by reference in this Prospectus or any other information provided by the Issuer in connection
with the offering of the Notes or their distribution.
No person is or has been authorised by the Issuer to give any information or to make any representation not
contained in or not consistent with this Prospectus or any other information supplied in connection with the
offering of the Notes and, if given or made, such information or representation must not be relied upon as
having been authorised by the Issuer or any of the Joint Lead Managers.
Neither this Prospectus nor any other information supplied in connection with the offering of the Notes (a) is
intended to provide the basis of any credit or other evaluation or (b) should be considered as a
recommendation by the Issuer or any of the Joint Lead Managers that any recipient of this Prospectus or any
other information supplied in connection with the offering of the Notes should purchase any Notes. Each
investor contemplating purchasing any Notes should make its own independent investigation of the financial
condition and affairs, and its own appraisal of the creditworthiness, of the Issuer. Neither this Prospectus nor
any other information supplied in connection with the offering of the Notes constitutes an offer or invitation
by or on behalf of the Issuer or any of the Joint Lead Managers to any person to subscribe for or to purchase
any Notes.
Neither the delivery of this Prospectus nor the offering, sale or delivery of the Notes shall in any
circumstances imply that the information contained herein concerning the Issuer is correct at any time
subsequent to the date hereof or that any other information supplied in connection with the offering of the
Notes is correct as of any time subsequent to the date indicated in the document containing the same. The
Joint Lead Managers expressly do not undertake to review the financial condition or affairs of the Issuer
during the life of the Notes or to advise any investor in the Notes of any information coming to their
attention.

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IMPORTANT INFORMATION RELATING TO THE USE OF THIS PROSPECTUS AND OFFERS
OF NOTES GENERALLY
This Prospectus does not constitute an offer to sell or the solicitation of an offer to buy the Notes in any
jurisdiction to any person to whom it is unlawful to make the offer or solicitation in such jurisdiction. The
distribution of this Prospectus and the offer or sale of Notes may be restricted by law in certain jurisdictions.
The Issuer and the Joint Lead Managers do not represent that this Prospectus may be lawfully distributed, or
that the Notes may be lawfully offered, in compliance with any applicable registration or other requirements
in any such jurisdiction, or pursuant to an exemption available thereunder, or assume any responsibility for
facilitating any such distribution or offering. In particular, no action has been taken by the Issuer or the Joint
Lead Managers which is intended to permit a public offering of the Notes or the distribution of this
Prospectus in any jurisdiction where action for that purpose is required. Accordingly, no Notes may be
offered or sold, directly or indirectly, and neither this Prospectus nor any advertisement or other offering
material may be distributed or published in any jurisdiction, except under circumstances that will result in
compliance with any applicable laws and regulations. Persons into whose possession this Prospectus or any
Notes may come must inform themselves about, and observe, any such restrictions on the distribution of this
Prospectus and the offering and sale of Notes. In particular, there are restrictions on the distribution of this
Prospectus and the offer or sale of Notes in the United States and the EEA (including in the United
Kingdom, Belgium and Sweden), see "Subscription and Sale".
The Notes may not be a suitable investment for all investors. Each potential investor in the Notes must
determine the suitability of that investment in light of its own circumstances. In particular, each potential
investor may wish to consider either on its own or with the help of its financial and other professional
advisers, whether it:
(i)
has sufficient knowledge and experience to make a meaningful evaluation of the Notes, the merits
and risks of investing in the Notes and the information contained or incorporated by reference in this
Prospectus or any applicable supplement;
(ii)
has access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its
particular financial situation, an investment in the Notes and the impact the Notes will have on its
overall investment portfolio;
(iii)
has sufficient financial resources and liquidity to bear all of the risks of an investment in the Notes,
including where the currency for principal or interest payments is different from the potential
investor's currency;
(iv)
understands thoroughly the terms of the Notes and is familiar with the behaviour of any relevant
indices and financial markets; and
(v)
is able to evaluate possible scenarios for economic, interest rate and other factors that may affect its
investment and its ability to bear the applicable risks.
Legal investment considerations may restrict certain investments. The investment activities of certain
investors are subject to investment laws and regulations, or review or regulation by certain authorities. Each
potential investor should consult its legal advisers to determine whether and to what extent (1) the Notes are
legal investments for it, (2) the Notes can be used as collateral for various types of borrowing and (3) other
restrictions apply to its purchase or pledge of the Notes. Financial institutions should consult their legal
advisers or the appropriate regulators to determine the appropriate treatment of the Notes under any
applicable risk-based capital or similar rules.

3

The Notes have not been and will not be registered under the United States Securities Act of 1933, as
amended, (the Securities Act) and are subject to U.S. tax law requirements. Subject to certain exceptions,
the Notes may not be offered, sold or delivered within the United States or to U.S. persons. For a further
description of certain restrictions on the offering and sale of the Notes and on distribution of this Prospectus,
see "Subscription and Sale" below.
PRESENTATION OF INFORMATION
All references in this Prospectus to U.S. dollars, U.S.$ and $ refer to the currency of the United States of
America, to euro and refer to the currency introduced at the start of the third stage of European economic
and monetary union pursuant to the Treaty on the Functioning of the European Union, as amended, and to
Swedish Kronor, SEK refer to the currency of the Kingdom of Sweden and CNY refer to the currency of
the People's Republic of China (PRC) which, for the purposes of this Prospectus, excludes the Hong Kong
Special Administrative Region of the PRC, the Macau Special Administrative Region of the PRC and
Taiwan.

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___________________________________
CONTENTS

Page
Risk Factors ........................................................................................................................................................ 6
Documents Incorporated by Reference ............................................................................................................ 18
Conditions of the Notes .................................................................................................................................... 20
Summary of Provisions relating to the Notes while Represented by the Global Notes ................................... 34
Use of Proceeds ................................................................................................................................................ 37
Description of the Issuer ................................................................................................................................... 38
Taxation ............................................................................................................................................................ 52
Subscription and Sale ....................................................................................................................................... 55
General Information ......................................................................................................................................... 57
___________________________________

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RISK FACTORS
In purchasing Notes, investors assume the risk that the Issuer may become insolvent or otherwise be unable
to make all payments due in respect of the Notes. There is a wide range of risk factors which individually or
together could result in the Issuer becoming unable to make all payments due in respect of the Notes. It is not
possible to identify all such risk factors or to determine which risk factors are most likely to occur, as the
Issuer may not be aware of all relevant risk factors and certain risk factors which it currently deem not to be
material may become material as a result of the occurrence of events outside the Issuer's control. The Issuer
has identified in this Prospectus the following risk factors which could materially adversely affect its
business and ability to make payments due under the Notes. The Issuer's assessment of the materiality of
each risk factor is based on the probability of their occurrence and the expected magnitude of their negative
impact. In addition, risk factors which are material for the purpose of assessing the market risks associated
with the Notes are described below. The description of the risk factors below is based on information
available and estimates made on the date of this Prospectus.
The risk factors are presented in categories where the most material risk factors in a category are presented
first under that category. Subsequent risk factors in the same category are not ranked in order of materiality
or probability of occurrence. Where a risk factor may be categorised in more than one category, such risk
factor appears only once and in the most relevant category for such risk factor.
Prospective investors should also read the detailed information set out elsewhere in this Prospectus and
reach their own views prior to making any investment decision.
RISK FACTORS THAT MAY AFFECT THE ISSUER'S ABILITY TO FULFIL ITS
OBLIGATIONS UNDER THE NOTES
Litigation, arbitration, antitrust proceedings and unanticipated claims
The Issuer is the parent company of the SKF group of companies (the Group). The Group is, and may
continue to be, involved in litigation and arbitration both as plaintiff and defendant. Many of these disputes
relate to claims arising in the ordinary course of business including, but not limited to, intellectual property,
product warranty and product liability. Unanticipated claims could have a material adverse effect on the
Group's business and results of operations.
SKF is subject to two investigations in Brazil by the General Superintendence of the Administrative Council
for Economic Defense, one investigation regarding an alleged violation of antitrust rules concerning bearing
manufacturers, and another investigation regarding an alleged violation of antitrust rules by several
companies active on the automotive aftermarket in Brazil. An enquiry has been initiated by the Competition
Commission of India against several different companies, including SKF, regarding an alleged violation of
antitrust rules in India. Moreover, SKF is subject to related class action claims by direct and indirect
purchasers of bearings in the United States and may face additional follow-on civil actions by both direct and
indirect purchasers. Bosch AG has initiated a lawsuit against SKF with a claim for damages as a
consequence of the settlement decision by the European Commission for violation of European competition
rules..
There can be no assurance that the Group will not become subject to additional legal proceedings, which
may have an adverse effect on the Group's business, financial position and results of operations.
Business risks in general
IT Risks

6

The Group faces risks relating to cyber intrusion by potential adversaries placing so-called ransomware on IT
assets or gaining unauthorised access to the Group's information or computer systems, which could lead to
loss, theft or manipulation of data, including intellectual property, manufacturing related data and financial
data, infringement of personal data or violations of export control regulations. Under certain circumstances
the risks identified above could have a material adverse effect on the Group's ability to operate and on its
competitive and financial position and could also be accompanied by risk of loss of reputation, litigation,
fines debarment and other actions by authorities.
The Group's operations are increasingly dependent on electronically stored and processed data, computer
systems and solutions. The Group has initiated a programme to replace its enterprise resource planning
systems in order to create a new common IT infrastructure. The implementation and roll-out process has
started and will be carried out over a number of years. An unplanned interruption to the Group's computer
systems with potential loss of production or delays in deliveries to customers or a major break-down of these
systems with loss of information or delays or issues with the roll-out and implementation of the new IT
infrastructure or any prolonged or severe disruptions to the Group's computer systems and solutions may
have a material adverse effect on the Group's business which in turn could have a material adverse effect on
the Group's financial position and results of operations. Further, any prolonged or severe disruptions to the
Group's computer systems and solutions would have an adverse impact on the Group's business, financial
position and results of operations.
General economic conditions and transitional risks
The Group operates in many different industrial and automotive segments, as well as in many geographical
areas that are at different business cycles. A general economic downturn at a global level, or in one of the
world's leading economies, or a change in the economic situation in any of the industry segments in which
the Group operates, could affect customers' investment plans which in turn could reduce the demand for the
Group's products, solutions and services for a period of time. In addition, terrorism, war, unrest and other
hostilities, as well as potential impacts of climate change, water availability, natural disasters (including but
not limited to earthquakes, tsunamis and ash clouds) and disturbances in the worldwide financial markets,
could have a negative impact on the availability and cost of raw materials and components necessary for the
Group's manufacturing process and/or the demand for the Group's products and services. Further, some of
the Group's businesses are subject to transitional risks related to trends such as increased digitalisation,
electrification or pressure to decarbonise industry sectors. Such developments may be driven by regulatory
requirements, taxes, tariffs or other governmental policies. Under certain circumstances any of the risks
identified above could have a material adverse effect on the Group's business, financial position and results
of operations.
Property and product liability insurance and product functionality
The Group has the customary insurance programmes with respect to the Group's property and product
liability risks. Measures to limit the effect of damages are continually taken and standards for desired
safeguard levels are established in order to reduce the probability of material damages and to ensure
deliveries to the customers. While the Group holds customary insurance programmes in the amounts the
Issuer believes to be appropriate, there can be no assurances that the Group will be able to fully recover such
amounts or that recovered amounts will be sufficient to cover the Group's losses.
The risk of product failure in customer applications may lead to warranty claims and/or loss of business
which could have a material adverse effect on the Group's business, financial position and results of
operations.

7

Political and regulatory risks
There are political and regulatory risks associated with the wide geographical presence of the Group. The
global and diverse nature of the Group's business and operations means that the Group is required to adhere
to numerous laws and regulations related to all aspects of its activities. Failure to meet these requirements
could lead to legal and financial consequences as well as damage to the Group's reputation. The Group is
exposed to compliance risks mainly related to competition law, fraud, export control, data privacy
(including, but not limited to, in relation to Regulation (EU) No 2016/679 (the General Data Protection
Legislation)), corruption and health and safety regulations. Regulatory requirements, taxes, tariffs and other
trade barriers, price or exchange controls or other governmental policies could limit or otherwise negatively
impact the Group's operations. Under certain circumstances any of the risks identified above could have a
material adverse effect on the Group's business, financial position and results of operations.
Competition
Competitors may find better and more cost-efficient ways to produce and distribute products and services.
They may also find ways to produce better functioning products. The Group's may suffer losses as a result of
new and disruptive technologies becoming available from companies which are not currently seen as
competitors. Competitive factors, including changes in market penetration, increased price competition, the
development and introduction of new products, product designs and technologies by significant existing and
new competitors and to a lesser extent small regional companies as well as changes in customer demand on
sales, product mix, prices and service quality could have a material adverse effect on the Group's business,
financial position and results of operations.
Also, the Issuer cannot give any assurance that its competitors do not or will not seek to utilise the Group's
patents, trademarks and logos when they market their products. Such unauthorised use of the Group's
intellectual property rights is an infringement of the Group's legal rights and may have a material adverse
effect on the Group's business, financial position, results of operations and brand image.
Changes in manufacturing costs as well as issues affecting manufacturing and production facilities of the
Group or its suppliers and its ability to distribute its products
Changes in the costs associated with the Group's various levels of operations including, but not limited to,
the effects of unplanned work stoppages, severe interruptions in its production and damage to the equipment,
the cost of labour, and the cost and availability of, for example, materials and energy supply from third party
suppliers could have a material adverse effect on the Group's business, financial position and results of
operations.
If critical equipment in the operating facilities is significantly damaged, or there are severe interruptions in
its productions, the Group is likely to face setbacks in its ability to manufacture and distribute its products.
Such circumstances, to the extent it is unable to find an alternative manufacturing and production facility or
repair the damaged facilities or damaged equipment in a timely and cost-efficient manner, could have a
material adverse effect on the Group's business, results of operations and financial position.
The Group's risk of production disruption is not only related to its own operations but also to disruption
further upstream in the demand chain. External factors such as fires, extreme weather events, natural
disasters, water scarcity, war, terrorism or pandemic illness might result in disruption of supply to SKF the
Group and have a material adverse effect on the Group's business, financial position and results of
operations.

8

Changes in costs for raw materials
Energy and the cost of carbon can have an impact on the Group's in several ways, for example through the
cost of energy and raw materials. The annual cost of raw materials and components is approximately SEK
26 billion of which steel-based products account for the majority. An increase/decrease of 1 per cent. in the
cost of raw materials and components would reduce/increase the operating profit by approximately SEK 260
million. Steel scrap is a major ingredient in making bearing steel. An isolated 10 per cent. increase/decrease
of market scrap prices would decrease/increase the Group's operating profit by approximately SEK 100
million. Calculations are based on the year-end figures for 2018 as well as on the assumption that everything
else is equal. A significant increase in the cost of energy, raw materials and/or components would have a
material negative effect on the Group's results of operations.
Retention of key employees
The Group has, and is dependent on, highly knowledgeable and skilled people and it works actively on its
ability to attract and retain its employees. Global processes have been developed for recruitment, employee
performance and the overall skills of employees. These processes will enable the Group to further develop
the skills within the Group to even higher levels. However, there can be no assurance that the Group will be
able to retain and attract all of the key employees that it requires at a reasonable cost and a lack of highly
qualified management and other skilled employees may have an adverse effect on the Group's business,
financial position and results of operation.
Work stoppages or strikes
Many of the Group's employees are covered by collective bargaining agreements and the Group holds
collective bargaining agreements with trade unions in 20 countries. The Issuer cannot provide any assurance
that it will not encounter strikes or other disturbances occasioned by its unionised labour force, or that, upon
the expiration of existing collective bargaining agreements, it will be able to reach new collective bargaining
agreements on satisfactory terms or without work stoppages, strikes or similar industrial actions.
Non-satisfactory terms on any collective bargaining agreements could cause the Group's labour costs to
increase, which would affect its profit margins negatively. In addition, it is required to consult and seek the
advice of its Employee Works' Council in respect of a broad range of matters, which could delay or prevent
the completion of certain corporate transactions. The Issuer cannot provide any assurance that it will not
experience lengthier consultations or even strikes, work stoppages or other industrial actions in the future.
Any industrial action could disrupt its operations, possibly for a significant period of time, and result in
increased wages and benefits (an increase of 1 per cent. in wages and salaries (including social security
charges) would reduce the operating profit by around SEK 250 million based on the position on 31
December 2018) or otherwise have a material adverse effect on the Group's business, financial position and
results of operations.
Environmental matters
As an industrial company, the Group is subject to numerous environmental laws and regulations governing,
among other things, air emissions, waste water discharge and solid and hazardous waste disposal. The Group
has a stringent process for preventing environmental pollution from its manufacturing processes. However,
like other long-established industrial companies, the Group is involved in various action plans and
remediation projects, resulting from historical activities. Because of stricter laws and regulations, some with
retroactive effect, relating to landfill disposal, some of the Group companies are currently involved in the
cleaning-up of old landfills, most of which have not been used for many years. The majority of these cases
concern so-called superfund sites designated by the U.S. Environmental Protection Agency and U.S. state
agencies and the authorities in several other countries. A superfund site is an old landfill or plant site in the

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