Swedish landlord SBB saw its credit rating cut one step to junk by Standard & Poor’s with the rating agency signaling it may downgrade further if the company doesn’t secure sufficient funds to meet its short-term financial obligations.
(Bloomberg) — Swedish landlord SBB saw its credit rating cut one step to junk by Standard & Poor’s with the rating agency signaling it may downgrade further if the company doesn’t secure sufficient funds to meet its short-term financial obligations.
Samhallsbyggnadsbolaget i Norden AB, as SBB is formally known, was cut to BB+ with a negative outlook by S&P on Monday. “We no longer believe SBB will maintain S&P Global Ratings-adjusted debt to debt plus equity of well below 60% over the next 12 months, with EBITDA interest coverage falling to about 2x by year end,” the rating firm said in a statement.
Swedish commercial real estate firms such as SBB have been struggling to refinance their sizable debt piles amid an aggressive round of interest hikes and investor concern for the sector generally. That has left them resorting to asset disposals, share issues and bank financing to get their debt metrics under control.
At the end of April, SBB announced plans to raise 2.6 billion kronor ($253 million) in new class D shares in an effort to shore up its finances.
The company’s shares fell 5.4% at 10:35 a.m. Stockholm time.
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