Ilija Batljan, former municipal councilor in Nynäshamn (S), was CEO of AP fund-owned Rikshem, but had to leave the company in 2015. Then he started Samhällsbyggnadsbolaget (SBB), which focused on owning properties that house public activities.
The company grew and was listed on the Stockholm Stock Exchange. The stock rose, and the company became something of a favorite among small savers.
On November 29, 2021, it was at its highest, over SEK 59 for the B share.
Since then, inflation and rising interest rates have shaken the real estate market. SBB is one of the real estate companies that have had problems with rising interest rates and are stuck in a debt trap.
At the end of 2022, SBB became the subject of so-called short selling, i.e. speculation that the share would fall.
SBB has tried to get out of the predicament in various ways. Both through sales and by bringing in new money in a new issue.
SBB reported an unexpectedly large loss for the first quarter and also announced that the board wants to raise 2.6 billion in new capital through a new issue.
The credit rating company S&P lowered SBB’s credit rating to junk level. This means that interest costs have increased noticeably for the company.
The board of the company was then called in for an extra board meeting, which decided that the share dividend would be postponed and that the planned new issue would be stopped. SBB’s share plummeted on the stock exchange.
When the credit rating was lowered, SBB’s board chairman Lennart Schuss was taken to bed, he told TT. He had difficulty understanding the stock market collapse of the crisis-hit real estate company, and thought the world was upside down.
He also firmly denied that SBB would sell its holding in JM, where SBB was the largest owner.
Two days later, however, the sale of the shares in JM was a fact. SBB sold 19 million shares in the construction company JM for around SEK 2.8 billion, which corresponded to around 29.5 percent of the shares and votes in JM.
The Left Party believes that the state may have to take over parts of the company SBB’s properties. The company has specialized in renting out properties to the public sector, including those that are important for security policy. Therefore, V wants a kind of right of pre-emption, similar to that which applies to tenants who want to buy their house in housing associations, to be quickly investigated.
At the end of May, SBB received another credit hit. The rating institute Fitch also lowered the rating to junk status, from BB- to BBB+, with a negative outlook. This was in line with the downgrade Standard & Poor’s announced for SBB on May 8, which caused the stock to crash.
SBB’s board announces that the company is for sale, in whole or in parts. Three strategic alternatives are to be evaluated by SBB’s board, to sell the entire company, to sell certain parts of operations or to sell individual properties.
Ilija Batljan Invest, major shareholder in SBB with 18.4 percent of the votes and 4.8 percent of the capital, announced on May 30 that the company is indefinitely postponing interest payments on its outstanding so-called hybrid bonds. The nearest due date is June 15.
On Wednesday, it became known that the government is in talks with real estate investors about the financially pressured situation on the Swedish real estate market, according to Dagens industri.
Throughout 2022, SBB’s share has plummeted. On Wednesday, the share stood at SEK 4:25 at lunchtime.
Source: nyheter24.se by nyheter24.se.
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