The logo of SBB is seen at company’s headquarters in Stockholm, Sweden, September 14, 2023. REUTERS/Marie Mannes/File Photo
U.S. hedge fund Fir Tree Partners, a bondholder in property group SBB (SBBb.ST) said on Monday the Swedish company’s debt buyback offer placed too much weight on the interests of shareholders and did not address its obligations to creditors.
Earlier this month Fir Tree Partners requested that SBB immediately repay a bond, saying the group was in breach of a debt clause, a claim the company has denied.
“SBB appears to be devoting its scarce resources to preserving equity value, rather than focusing on near- and long-term senior obligations,” Fir Tree said on Monday in an “open letter” to fellow bondholders.
Loss-making SBB, which is at the centre of a wider Swedish property crash, said on Thursday it would offer to buy back hybrid and senior securities for up to $650 million as the group looks to cut debt on its balance sheet.
In response, credit rating agency S&P on Friday placed SBB on credit watch for a potential downgrade to a selective default, as purchasing debt at a substantial discount to the original amount could be considered tantamount to default.
Fir Tree, which said it holds bonds maturing in 2028 and 2029, also questioned SBB’s offer to buy back hybrid notes with no maturity, arguing that this was not required.
SBB was not immediately available for comment when contacted by Reuters.
Reporting by Marie Mannes, editing by Terje Solsvik
