The Swedish Samhällsbyggnadsbolaget i Norden (SBB) has completely collapsed on the stock market since the peak in autumn 2021. The steep rise in interest rates has been pure poison for SBB, which in recent years has grown strongly with the help of heavy leverage.
It got worse when the credit rating agency S&P Global downgraded the company’s long-term credit rating and assessed the outlook as negative. Since then, the debt-laden company has dropped both dividends and capital raising.
Now SBB is also selling shares for billions in another Swedish property company.
Must strengthen liquidity
On Thursday evening, SBB announced that on the same day it had sold 19 million shares in the Swedish property company JM. The sale from SBB, which was the largest owner in JM, corresponds to around 29.6 per cent of outstanding shares.
SBB sold the shares without discount at SEK 148.10 per share. In total, shares were then sold for 2.8 billion Swedish kroner.
After the sale, SBB directly and through derivatives owns around 1.9 million shares in JM. SBB has undertaken not to sell any more JM shares for the next 90 days, subject to certain reservations.
The billion sum SBB is left with will be used to strengthen the company’s liquidity and financial position, it is stated.
Bought at higher rates
SBB entered JM heavily in the summer of 2021 when the company bought a large shareholding for 4.6 billion Swedish kroner from Obos. During the autumn of the same year, SBB further acquired JM. At that time, the share price was around twice as high as it is today.
The JM share, like other property shares in Sweden, has fallen sharply on the stock exchange over the past year and a half.
As recently as in the annual report for 2022, which was published on 31 March, SBB wrote that the ownership in JM was strategic and long-term. In an interview with the Swedish news agency TT earlier this week, SBB chairman Lennart Schuss said that a sale of JM would not be relevant, according to Today’s Industry.
In its assessment, S&P pointed out that SBB must refinance bond loans totaling SEK 14 billion over the next twelve months, which creates concerns for the company’s liquidity situation. (Terms)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links, which lead directly to our pages. Copying or other forms of use of all or part of the content may only take place with written permission or as permitted by law. For further terms see here.
2023-05-12 05:22:03
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