Sweden's Fastator aims for standstill agreement with creditors over debt breach

Fastator AB (publ)

11/03/2024 17:38

STOCKHOLM, March 11 (Reuters) - Swedish real estate
group Fastator  FASTAT.ST  said on Monday it hoped to reach a
standstill agreement with its bondholders to avoid repayment
demands as a result of a covenant breach. 
    Fastator is one of many property companies hit by Sweden's
wider property crisis, triggered by high debts, rising interest
rates and a wilting economy. 
    In February, the company said it had breached its financial
solvency covenant and that it would start negotiations with
major bondholders to mitigate the situation.
    Fastator's equity was worth an estimated 33% of its overall
balance sheet at the end of 2023, below the minimum 45% mandated
by the covenants. 
    On Monday, the company said it aimed to reach a so-called
standstill agreement with its bondholders to avoid enforcement
measures, and to allow the company to find long-term financial
solutions. 
    If the company is successful in getting a standstill
agreement this would mean that its creditors would agree to not
demand immediate repayment of the bonds during the negotiations
for a long-term solution.
    Fastator would then explore an extension and change of bond
terms or an exchange of securities, among other things, it said.
    The company also said that its portfolio company Point
Properties had failed to reach an agreement with its own
bondholders for a bond maturing in 2024, where it had hoped to
get an extension. 
    Fastator's overall liabilities stood at 2.6 billion Swedish
crowns ($253.76 million) at the end of September of last year,
according to its third-quarter earnings report. 
    Fastator in February reported a fourth-quarter loss of 561.5
million crowns, widening from a 186.0 million loss a year
earlier, and also said it had been hit by write downs of
property values in Fastator's portfolio companies.


($1 = 10.2457 Swedish crowns)

 (Reporting by Marie Mannes and Louise Rasmussen; Editing by
Susan Fenton)
 ((marie.mannes@thomsonreuters.com; +46 8 502 423 82;))