SBB Norden - comment
The tender offer purchases favoured hybrids (75% of the nominal acquired) over SUNs as we expected. However, we were a little surprised at the level of 2025 – 2027 notes that SBB acquired, as the company had said it would target the steepest discounts. We estimate that the average price paid for bonds is >50c€, a higher figure than we thought, but reflective of the 25% spent by SBB acquiring SUNs. The main beneficiary here is the equity, with LTV falling from >100% to 95% (40% of the D Shares are also being sought in a separate tender).
There is no news on the new bank loan for the Resi business, but if a Q4 completion is the aim, SBB needs to get a move on. The tender offer saw SEK4bn nominal in bonds tendered, which means the new bond will be SEK1.7bn. The conversion rate to the new bond is 80% of the tender price => the average tender price for bonds is 53c/€. The new bonds will be obligations of the Resi business and not SBB (although they will impact the value of the equity).