Krupp's Bofors shares and the limits of corporate control

Krupp's agreement with Bofors began in 1919 and helped preserve German artillery design work after the First World War. Bofors took over Dutch and Danish contracts in September that year. A 1921 agreement barred exports of Krupp-derived material to Britain, the United States, France, Italy, and Japan. Krupp obtained 31.8 percent of Bofors stock through a Swedish subsidiary, while Swedish law limited foreign ownership to 20 percent. The indirect holding left its position vulnerable to intervention by the Swedish government. A large shareholding also failed to guarantee obedience from Bofors directors, who repeatedly frustrated Krupp's attempts to exercise control.