Ivar Kreuger
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Ivar Kreuger (March 2, 1880 – March 12, 1932) was a Swedish financier, entrepreneur and industrialist. In the time between the two world wars, he was one of the most powerful businessmen in Europe, basing his business activities on match production. He gained a match monopoly and became known as the "Match King".
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[edit] History
Kreuger was born in Kalmar, the eldest son of the banker, industrialist and Russian consul Ernst August Kreuger and his wife Jenny. In school Ivar skipped ahead two classes to graduate at age 16, continuing his studies at the Royal Institute of Technology in Stockholm where he graduated with two Master's degrees from the faculties of mechanical and civil engineering, at the age of 20.
From the turn of the century he spent seven years travelling and working abroad as an engineer in the U.S., Mexico, and South Africa, among other countries, before returning home. In 1908, he formed construction firm Kreuger & Toll, with fellow engineer Paul Toll. The firm was a success and won prestigious contracts like the construction of the Stockholm Stadium and the department store Nordiska Kompaniet in Stockholm.
[edit] Companies
In 1917 Kreuger formed Svenska Tändsticks AB (Swedish Match), which by expanding through acquisition of national monopolies became the world's largest match manufacturer. He set up an affiliate to Kreuger & Toll in the United States and formed the International Match Corporation which eventually came to control two thirds of the world production in matches.
In the years when Europe was suffering from the problems of the Great Depression, Kreuger's companies would often give loans to European governments needing money, and as a security the government would grant his empire the match monopoly in this country. In 1929 Kreuger loaned equal to $28 million to Romania. In return, he gained a monopoly in match sales. This debt remained unpaid to 2002.
Kreuger did not limit himself to mere matches but gained control of most of the forestry industry in northern Sweden and planned to became a head of a cellulose cartel.
After founding the pulp manufacturer SCA in 1929 Kreuger were able to acquire the majority shares in the telephone company Ericsson, the mining company Boliden, and major interests in the ball bearing manufacturer SKF, the bank Skandinaviska Kreditaktiebolaget as well as others. Abroad he acquired Deutsche Unionsbank in Germany and Union de Banques à Paris in France and by 1931 an estimated 200 companies were controlled by Kreuger. However the Stock Market Crash of 1929 turned out to be a major factor in the liquidity crisis that would be fatal to both Kreuger and his Empire.
At the peak of his career the Kreuger fortune was estimated at a value of 30 billion Swedish kronor in 1929, equivalent to approximately 100 billion USD in 2000. In the same year the total loans made by Swedish banks were barely 4 billion SEK, and an average worker had an annual salary of 3,195 SEK.
[edit] Kreuger Crash
By 1932, rumours had started spreading that Kreuger & Toll and other companies forming Kreuger's empire had become financially unstable. Securities of Kreuger & Toll were very wanted in Wall Street. When the company went bankrupt in 1932, claimed assets worth of $250 million turned out to be nonexistent.
On March 12, 1932 Ivar Kreuger was found dead in his bed at his apartment in Paris. Evidence suggested that he had shot himself, committing suicide rather than face his creditors. Later rumors (or rather conspiracy theories) claimed that Kreuger's wounds had not been self inflicted, but the death nevertheless precipitated the Kreuger Crash which hit both investors and the group companies.
Prior to the crash, Kreuger had issued thousands of debentures. These were very popular, and a firm public belief in the rising Kreuger empire convinced contemporary Swedes to invest their savings in these "Kreuger papers". Following the Kreuger crash, these debentures became worthless, and several thousand Swedes lost their life savings as a result.
Kreuger is interred in the Norra begravningsplatsen in Stockholm.
[edit] Fictional depictions
Ivar Kreuger was the inspiration for the "Bjorn Faulkner", a character in Ayn Rand's 1935 hit Broadway play, Night of January 16th.
Ivar Kreuger was also the inspiration for the character of Paul Kroll in the 1933 Hollywood film The Match King directed by William Keighley, starring Warren William and Lili Damita
Ivar Kreuger also inspired the character of Erik Krogh in Graham Greene's novel, England Made Me (1935)
[edit] Trivia
Invented Three on a Match (superstition) in order to get people to use more matches.
[edit] Source
- Torsten Kreuger: Die Wahrheit über Ivar Kreuger, West Berlin: Ullstein Verlag, 1968
[edit] External links
- Ivar Kreuger - Bibliography at Project Runeberg
- Ivar Kreuger - A television mini series (in Swedish)
- Ivar Kreuger - at www.ivarkreuger.com
- Ivar Kreuger's Gravesite
