By Dominic Chopping
STOCKHOLM--Shares in Swedish property group Samhaellsbyggnadsbolaget i Norden surged Monday after it said it will buy back debt at a 60% discount as it continues to shore up its balance sheet.
At 0825 GMT, shares traded 14% higher at 4.19 Swedish kronor ($0.40).
The company--known as SBB--borrowed heavily to pay for a sprawling portfolio of public property, including social housing, healthcare facilities, schools and government buildings. It has been hit hard by the sharp increase in interest rates and has moved to sell and spin off portions of its portfolio to raise cash.
Shares have fallen by around 94% since their peak of around SEK68 in late 2021.
It recently sold a stake in its portfolio of Nordic education buildings to Canadian real-estate investor Brookfield Asset Management that will bring it around SEK8 billion in cash, while a joint venture deal last month with private-equity firm Castlelake will give it SEK5.2 billion in cash proceeds, part of which will be used to refinance debt.
In a statement Sunday, the company said it would pay 162.7 million euros ($175.9 million) to buy back EUR407.8 million of debt.
It had initially said it could buy back debt for up to EUR250 million to help proactively manage the balance sheet. "Simultaneously, the offers will enable SBB to manage its overall wholesale funding level and better optimise its future interest expense," it said at the time.
The move follows a similar deal it made at the end of last year when it bought back EUR417.2 million of debt for EUR403.8 million--a 3.2% discount.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
March 25, 2024 04:41 ET (08:41 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
Comments