Debt-Laden SBB ends losing streak with first-quarter profit (updated)

Samhallsbyggnadsbolaget I Norden AB

13/05/2025 07:05

Recasts to add details on deal with APG throughout

SBB swings to pre-tax profit in Q1, ending losing streak

Announces deal with Norway's Aker

Aker Property Group to become largest SBB shareholder

By Jesus  Calero, Greta Rosen Fondahn

May 13 (Reuters) - Swedish landlord SBB SBBb.ST swung to a pre-tax profit in the first quarter of 2025 after eleven consecutive quarterly losses, it said on Tuesday, while separately announcing a deal that would make Norway's Aker Property Group its largest shareholder.

The debt-laden real estate group, which owns properties such as hospitals and care homes in Sweden, reported a January-March profit before tax of 1.9 billion Swedish crowns ($194 million), compared with a revised loss of 1.18 billion a year earlier.

SBB was one of many European real estate firms that had to cut debt and restructure their finances amid a period of high interest rates and economic weakness, particularly in Sweden, although market conditions started to stabilise last year.

Its net operating income fell to 510 million crowns in the first quarter from 736 million a year earlier. However, lower costs helped the metric rise 4.3% in comparable portfolios.

"SBB is now allocating resources and focusing on its occupancy ratio and rental level to ensure that there is every opportunity for income to improve going forward," CEO Leiv Synnes said in a statement.

In a separate press release, SBB said it had secured the right to buy another 39.8 million shares in its associate company Public Property Invest (PPI) PUBLI.OL from Aker Property Group (APG), part of Norway's Aker AKER.OL.

That would make APG its largest shareholder by share capital, with a 9.08% stake.

The deal follows PPI's issuance of new shares in exchange for an industrial infrastructure portfolio worth 2.33 billion Norwegian crowns ($223.73 million) from TRG Real Estate, which is controlled by Aker Chair Kjell Inge Rokke.

TRG has agreed to transfer a portion of the PPI shares to SBB in exchange for 164.6 million new B-shares in the Swedish group. It would then transfer both the right to receive its remaining PPI shares and the SBB shares to APG, Aker said in a statement.

SBB remains the largest shareholder in PPI, while APG would become its second biggest shareholder.

"Rokke obviously sees great potential in this, as the non-cash issues are made in companies ... that are valued at net asset value discounts," Carlsquare analyst Bertil Nilsson said.

Shares in SBB rose 20% in early trading in Stockholm. They have lost about 90% of their value since peaking in 2021. PPI's shares gained 5.9% in Oslo.

($1 = 9.7981 Swedish crowns)

($1 = 10.4145 Norwegian crowns)

(Reporting by Jesus Calero and Greta Rosen Fondahn in Gdansk, editing by Milla Nissi-Prussak)

((Jesus.calero@thomsonreuters.com))