Sweden's Oscar Properties proposes rescue plan, one bank says no (updated)

Oscar Properties Holding AB

08/11/2023 13:19

(Updates throughout with comment, background)
       STOCKHOLM, Nov 8 (Reuters) - Sweden's Oscar Properties
 OP.ST  said on Wednesday it had proposed a refinancing plan
after two of its lenders last month demanded the immediate
repayment of 2.1 billion crowns ($192 million) in debt, although
one bank rejected the scheme.
    High debts, rising interest rates and a weak economy have
left Swedish property companies buckling under soaring borrowing
costs and slowing demand.
    Oscar Properties is so far the only company that has
experienced a demand for immediate repayment of a bank loan. 
    The company said one lender had accepted the plan and would
withdraw its notice of termination of a 485 million crown loan.
    But the other bank has not accepted the plan and maintained
its demand for immediate repayment of 1.6 billion crowns, Oscar
Properties said in a statement without naming either bank.
    The company will keep trying to reach a deal, it said, while
adding that it was also in negotiation with creditors over other
debt.
    Last month, it said it was in talks with its major creditors
and had postponed interest payments on some of its debt.
    In connection with its third quarter report in late October,
Oscar CEO Carl Janglin said high interest rates had drained the
company's liquidity and the company's survival hinged on
attracting new capital. 
    "The company's liquidity is very strained. The situation
requires a rapid and comprehensive restructuring," Janglin said
at the time.
    The new preliminary financing plan includes capital
injections from existing and new owners as well as debt
conversion, the real estate company said.
    Carlsquare analyst Bertil Nilsson said the agreement
announced on Wednesday was a step in the right direction.
        However, he said the company needed to do more,
including seeking further investment through a possible share
issue and refinancing the 1.6 billion crowns loan from the bank
that rejected the new plan.     
    ($1 = 10.9644 Swedish crowns)

 (Reporting by Anna Ringstrom and Marie Mannes, editing by Terje
Solsvik and Barbara Lewis)
 ((anna.ringstrom@thomsonreuters.com;))