Photo: AFP

The founding family of clothing brand H&M has been buying more and more of the company’s shares. Since 2016, they’ve spent over 63 billion kronor (about $6.6 billion). This has led many people to wonder if they plan to take H&M off the stock market and make it a private company again — even though the family says that’s not their plan.

H&M was started in 1947 by Erling Persson in Sweden. Today, his family still owns a big part of it through their company called Ramsbury Invest. The family says they are buying shares because they “believe” in the company. But some people think they’re trying to take full control in secret.

Right now, they own about 64% of H&M through Ramsbury, and including the shares held by other family members, they control around 70% of the company. Even more importantly, they have 85% of the voting power, which gives them strong control over decisions.

Karl-Johan Persson, the grandson of the founder, is now the Chairman of H&M. He said in a past interview that they are not trying to take the company private — “We just buy because we believe in the company,” he said. But some experts don’t believe that. They say if that’s true, the family should be more open about their plans and stop secretly buying so many shares.

Niklas Ekman, a financial expert at DNB Carnegie, said that if the family keeps buying shares at the same speed, they could try to buy the rest of the company in just two years. If they reach 90% ownership, they can ask to remove H&M from the stock market completely.

Ekman also said the reason for going private might not be about money, but more about emotions — because the family already has so much control. The head of the family, 77-year-old Stefan Persson, led H&M for many years and still cares a lot about the company. His son, Karl-Johan, also helps manage the family’s investment company.

Another expert, Daniel Schmidt from Danske Bank, said the Persson family has never shown a big interest in staying public. He believes they don’t share much information about their plans, which can be unfair to small investors.

H&M’s stock price is much lower now than it was 10 years ago. It has dropped about 60%, while Zara’s parent company, Inditex, has gone up by 60%. This drop in price could make it easier and cheaper for the family to buy the remaining shares. But it could still cost them at least 70 billion kronor, and they may need to borrow money to do it.

Charles Allen, an expert from Bloomberg Intelligence, said that taking the company private might make it harder for H&M to spend money on growing the business, because they'd need to pay off any loans first.

Right now, H&M is also facing other problems. Sales are not strong, competition is tough, and new fashion brands like Shein are getting more popular. Their latest financial results weren’t great, and new marketing efforts haven’t helped much. The new CEO, Daniel Erver, took the job in January but hasn’t been able to win back customers in key markets like Germany, France, and the UK.

H&M has also been criticized for not being open about sudden leadership changes. It’s the only major company on Stockholm’s stock exchange that doesn’t share how many shares its top leaders own.

Allen also said that being a public company helps make sure managers are doing a good job because more people are watching. It also helps offer better rewards to employees, which might not be possible if H&M goes private.

Anders Oscarsson, who manages money for one of Sweden’s biggest pension funds, said he hasn’t heard anything from the family about making H&M private. But he said it would be a big loss for other investors if it happens.

He also warned that if too few people own the shares, it could hurt the company’s stock and make it harder for others to buy or sell. “It might become like Hotel California,” he said — “you can check in, but you can’t check out.”