Swedish real estate company SBB, aided by high leverage, has been growing at record speed, but with interest rates rising sharply recently, this has put pressure on earnings.
Last winter, shortstop Viceroy Research publicly attacked SBB in a comprehensive report in which the company laid out what they believed was a bias between how SBB portrayed financial risk and how it actually was. Subsequently, many prominent Norwegian investors threw themselves in and bet on the stock price falling, such as Peter Hermannrod, Jan Peter Cesner and Ole Peter Kjerkreit.
according to industry todaySources, there will be another short attack on the way, this time against Ivar Tollefsen’s Heimstaden.
The paper writes that many international hedge funds have begun to focus on the Heimstaden system, with some players beginning to bet on a drop in the share price while others are still in the preparatory stage.
Big problems
According to Dagens Industri, the reason short sellers are now chasing after Heimstaden is Heimstaden Bostad’s purchase of Akelius’ portfolio in 2021, which Finansavisen reported earlier. It was bought for NOK 94 billion at a continuing yield of 2.3 per cent.
As interest rates have risen a lot since then, it has sparked interest among international hedge funds, which are generally critical of the Swedish real estate market. Among them, there is an expectation that Heimstaden Bostad will risk breaching the terms of the loan.
It is also indicated that investors see a significant risk for Heimstaden AB by the fact that some of the company’s bonds are now priced at less than half of their face value.
– Looking at prices, the sentiment in the market can be said to be very negative around the entire Heimstaden group, credit and property analyst Michael Johansson at Arctic Securities tells the paper.
With more capital?
Heimstaden AB and the Swedish pension fund Alecta are the largest owners of Heimstaden Bostad. Many of the paper’s independent sources believe it might become appropriate for Alecta to inject more money into Heimstaden Bostad, without the fund itself wanting to comment on that.
Heimstaden AB is listed on the Stockholm Stock Exchange. So far this year, the stock is down 30 percent.
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