Nordic real estate firm SBB has launched a SEK 23.5 bn (€2.2 bn) cash-and-share takeover offer to buy rival Hemfosa in a deal which would create a Nordic leader in public service properties such as schools and care homes.
The transaction - which has been recommended by Hemfosa's board - values each Hemfosa share at SEK 126.15 - a premium of 22.7% to the closing price on Thursday - and each Hemfosa preference share at SEK 194.63.
'We would be happy to create the social infrastructure champion of the Nordics,' commented SBB CEO Ilija Batljan said. The combined company would have an attractive and stable property portfolio characterized by exposure to the Nordic welfare states with long term leases, high occupancy rates and a diversified tenant base, he added.
SBB said the two companies’ property portfolios were complimentary, as both focuses on services such as schools, elderly care homes and municipal offices. The deal is expected to lead to synergies of around SEK 300 mln per year.
If successful, the operation would create a new combine with a property portfolio valued at over SEK 70 bn, ranking as the fourth largest listed real estate firm in the Nordic region after Balder, Castellum and Fabege. The group would have a market cap of SEK 38.5 bn.
The majority of properties owned by both firms are in Sweden, but the acquisition would also give SBB a wider geographical spread as Hemfosa owns significant property in Norway and a smaller portion in Finland.
The acquisition is fully financed, SBB said, partly through the issue of around SEK 1.5 bn in new shares as part of the acquisition plan.
The acceptance period for the offer is expected to commence around 19 November 2019 and end around 20 December 2019. The Offer is conditional upon SBB reaching a stake of at least 90% of the total number of shares in Hemfosa on a fully diluted basis.
