© Reuters. FILE PHOTO: The logo of SBB is seen at the company’s headquarters in Stockholm, Sweden, September 14, 2023. REUTERS/Marie Mannes/File Photo
STOCKHOLM (Reuters) – Swedish real estate group SBB offered on Monday to buy back more of its debt, seeking to reassure investors about its finances in the midst of a property market downturn.
High debts, interest rate hikes and a wilting economy have hit many European property companies, with the sector in Sweden among the worst affected.
Some companies have launched tender offers for their bonds, aiming to reduce debt at discounted prices and signal to investors that their finances are strong enough to do so.
Loss-making SBB late last year spent 403.8 million euros ($440 million) on buying back debt at a small discount to the nominal value.
The company said on Monday it was open to repurchasing up to 250 million euros of hybrid and senior securities, and set a March 22 deadline for bids.
“The purpose of the offers … is, amongst other things, to proactively manage SBB’s balance sheet. Simultaneously, the offers will enable SBB to manage its overall wholesale funding level and better optimise its future interest expense,” it said.
Carlsquare analyst Bertil Nilsson said SBB’s repurchase limit equated to around 70% of its liquidity as of Dec. 31.
“The fact that SBB submits a repurchase offer … is a sign that the company considers that their liquidity situation is good enough to be able to carry out such repurchases,” he said.
($1 = 0.9179 euros)
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