SBB has announced that a bondholder has threatened to call back their bonds, claiming that the Swedish social property company is not meeting its financial obligations.
An unnamed bondholder alleges that SBB is in breach of the EMTN (Euro Medium Term Note) consolidated covenant ratio, a measure of a company's ability to service its debt. The bondholder claims that their bond holdings are due and payable.
The bondholder's holdings represent around €46 mln in nominal amount, or about 1% of SBB's total bond loans as of 30 June 2023, and refer to bonds maturing in 2028 and 2029.
SBB firmly rejects the claim that it is in breach of the EMTN consolidated covenant ratio and considers the acceleration notice to be invalid.
The company said it is taking all necessary measures to protect its interests and those of its stakeholders and has engaged experienced legal and financial advisors. It added that it will continue its transformation and strengthen its financial position.
SBB took out a lot of loans to buy a large portfolio of public buildings, such as social housing, hospitals, schools, and government buildings.
The company has been hurt badly by the recent increase in interest rates, and it is selling and spinning off parts of its portfolio to raise money.