Switzerland – Europe’s overlooked activist opportunity

In the early 2000s, I wrote about an American activist taking on one of Switzerland's most famous railway operators, Jungfraubahn Holding.

Few took it seriously at the time.

Since then, the stock has increased roughly tenfold in Swiss francs (and about 15-fold in euro or dollar terms). Notably, this performance came with limited operational risk. A monopolistic railway operating in a world-famous tourist destination is, in many ways, a self-sustaining business.

Missed that one?

Recent changes to Swiss corporate law may open the door to more opportunities of this kind.

Jungfraubahn Holding.

A wide-open country – with important restrictions

Switzerland is famously conservative and generally averse to outsiders telling it what to do.

This is also reflected in its corporate landscape.

Even though the country is broadly open to foreign investment, there have long been numerous mechanisms allowing companies to keep outside influence under tight control.

Some Swiss companies require shareholders to be registered by name, with board approval needed for new registrations. This has led to cases where outsiders were refused registration – and "outsiders" can even include Swiss citizens from a different region.

Other companies cap voting rights per shareholder or maintain super-voting shares that remain tightly held by local incumbents.

Yet others restrict access through unwieldy share denominations. The chocolate producer Lindt & Sprüngli (ISIN CH0010570759, SIX:LISN), for example, is famously trading at a six-digit Swiss franc price per share (see my July 2022 Weekly Dispatch on the company). Anyone can buy it, but a single share currently sets you back around USD 140,000.

However, much is beginning to change – even in Switzerland!

Helvetia now accepts constructive activism

The 2023 reform of Swiss corporate law wasn't widely noticed, not least because attention was focused on events in Ukraine and the aftermath of the pandemic.

Until then, a shareholder needed to represent 10% of share capital to add an agenda item for a vote at the annual general meeting.

For publicly listed companies, this threshold has now been reduced to just 0.5% – a far more attainable level.

Similarly, a shareholder with 5% can now requisition a shareholders' meeting, compared to 10% previously.

Just as importantly, the broader acceptance of active shareholders has evolved.

When I first reported on the American activist Ron Langley taking a stake in Jungfraubahn Holding in the early 2000s, the Swiss establishment reacted with something close to outrage. The idea of a foreign investor influencing one of the country's most iconic companies was widely frowned upon.

Today, the tone has shifted.

Finanz und Wirtschaft, Switzerland's leading German-language business daily, carries significant influence among corporate executives. In an article published on 18 September 2025, the paper noted how "activist investors are transforming from bogeyman to catalyst".

What matters according to FuW, however, is how activism is conducted. Aggressive, high-profile campaigns for control are unlikely to succeed. By contrast, "active owners" who "offer constructive suggestions" are increasingly seen as a "catalyst for overdue changes that benefit all stakeholders".

One investor with a track record in this approach is Spectrum Entrepreneurial Ownership (SEO), a Switzerland-based fund management firm backed by long-term capital from family offices, pension funds, and institutional investors. The firm deploys capital using a private equity-style approach in European public companies, with a particular focus on Switzerland.

Its managing partners, German-born Fabian Rauch and Swiss-born Dr. Ilias Läber, have been involved in developments at dormakaba Holding (ISIN CH1486524122), U-blox (ISIN CH0033361673), and Landis+Gyr (ISIN CH0371153492).

Source: CNBC, 8 March 2025.

I reached out to Fabian to get his perspective on the current state of shareholder activism in Switzerland and the opportunity set available to investors. He replied: "At SEO, we are finding Switzerland to be a target-rich environment with many attractive investment opportunities. We are looking to uncover companies that operate good businesses in healthy industries, but that are not performing up to their full potential for a host of different reasons. Our team works constructively with these companies, often through Board participation, to accelerate progress across many organizational dimensions. After a few years of SEO involvement, the end result is often a better company with a greater earnings power, a better balance sheet and healthier governance and a stock which has rerated to reflect this new reality. Importantly, we carry out this critical work for the benefit of all long-term shareholders."

SEO is pursuing this strategy as an institutional investor. Notably, even private individuals may increasingly take a more active approach in Switzerland.

Activism at the Matterhorn

I was first alerted to this opportunity by a long-standing Undervalued-Shares.com reader.

Patrick Fournier is an active investor based in Zug. We met several years ago at his family home to discuss our shared interest in frontier markets.

Today, his focus has shifted closer to home.

He allowed me to share the following:

"We have progressively sold all our portfolio of foreign shares and are now focusing on Swiss small & mid cap. We see huge value opportunities on this segment. We intend to become a little 'activist' as it is now possible with only 0.5% of capital in a listed company (far lower than the previous 10%) to add some proposition at the agenda of the annual general meeting of shareholders. This will wake up the Board of several companies, including regarding the dividend (payout) policy. As a result, we are in front of a 'rerating' (multiple expansion) of this segment."

His family holding company, Alarick AG, is privately held but has a publicly verifiable track record.

"We are the main private shareholder of SA des Remontées Mécaniques du Wildhorn ('Télé Anzère'). I have bought the shares of Russian investors a few years ago. In 6-7 years, we have doubled the turnover and moved from 1 million loss the 'good' years to 1 million profit the 'poor' year (8 millions turnover, 3 million EBITDA). We are neighbour of Crans-Montana ski resort (taken over by Vail Resort at 28x EBITDA!). We intend to create a cable car between both ski resorts, creating the 7th biggest ski resort in Switzerland with over 200km of slopes. Canyon and Park City did merge like that, and it was the start of Vail Resort several decades ago. You can still find plenty of shares of 'Télé Anzère' at 6-8 times EBITDA."

One case he has recently been working on more actively – and which also warrants attention – is BVZ Holding (ISIN CH0008207356).

"The stock is going up like a cogwheel railway", Patrick says – an insider joke, given the company's assets.

BVZ Holding.

BVZ operates tourism and mountain railways in the Swiss Alps, including the scenic Glacier Express between St. Moritz and Zermatt, as well as the Gornergrat cogwheel railway overlooking the Matterhorn.

By coincidence, I recently travelled on both the Glacier Express and the Gornergrat Railway. As far as the company's products and services are concerned, I can give them a clear thumbs up.

In its approach to BVZ, Alarick Holding has called for an increase in the annual dividend, a special dividend, and share buybacks. Owning more than 0.5% of the company's share capital, Alarick Holding argued the following (machine-translated from German):

"To remain attractive to investors, BVZ must pursue a competitive dividend policy compared to the market leader in alpine tourism, Jungfraubahnen AG (which generates about three times the recurring net profit of BVZ, but has a market capitalisation six times greater). Jungfraubahnen, which has previously distributed about 40% of its profits to its shareholders annually, recently raised its payout ratio forecast to a range of 50% to 66%

In 2005, BVZ (private divisions) generated a profit of CHF 3.7 million and paid a dividend of CHF 1.6 million, distributing 43% of the profit to shareholders. In 2023, BVZ achieved a net profit of 22.2 million (six times more than in 2005) and paid a dividend of 3.2 million (twice as much as in 2005), distributing 15% of its annual net profit to shareholders.

It should be noted that BVZ's return on investment has lagged far behind its business for almost a decade, despite comparable operational strength. The ordinary dividend of CHF 50 proposed by Alarick SA, which corresponds to slightly less than CHF 10 million, allows BVZ to return to a modern distribution policy, although it remains very cautious, as this amount represents a payout ratio of less than 50% of the net profit generated by the private sector that year.

Since the current BVZ share price is significantly below the market value of BVZ's equity,

which corresponds to a fair price of slightly more than CHF 2,000 per share, and since the balance sheet shows a substantial liquidity surplus, it makes sense for BVZ shareholders to use a portion of its excess cash, namely CHF 10 million, for the buyback of BVZ shares."

BVZ held its annual general meeting on 8 April 2026, and the results were telling.

Some 287 shareholders attended, representing 110,328 out of 197,278 shares outstanding (with one shareholder alone holding 56,000 shares). Alarick's proposal to increase the dividend from CHF 18 to CHF 50 received 14.5% support and was rejected by 83.8%. As a result, the board's proposal to raise the dividend from CHF 16 to CHF 18 was approved. With earnings per share of CHF 151, this implies a payout ratio below 20%. The proposal to initiate a share buyback programme received 16.67% support and was rejected by 82%, and therefore did not pass.

What may sound like a defeat is, in fact, the equivalent of an earthquake. In Switzerland's highly consensus-driven corporate culture, such a level of shareholder dissent represents a clear wake-up call for management.

The market agreed. On the day of the meeting, the share price closed at an all-time high of CHF 1,550, up 67% over the past 12 months.

As the recent share price performance suggests, even raising one's voice in a constructive manner can create value for shareholders in Swiss companies.

There are likely many more such opportunities. This makes the market worth following more closely – particularly when including the large universe of OTC-traded Swiss shares, which outnumber the 250 companies listed on the SIX Swiss Exchange by a wide margin. I had reported about this segment in my 2020 article: "Finding opportunities (and adventure) among unlisted companies".

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