Heimstaden AB - comment

Times have changed.  Heimstaden AB, the holding Company, are contemplating an Amend and Extend for its two 2025 SEK bonds and 206 Euro bonds.  This morning the Company announced a tender offer, subject to the successful issuance of new senior unsecured notes with 3-5yr maturity.  The tender is at par for the 3 bonds, with priority given to investors who participate in the new deal. 

In a related transaction, Heimstaden AB has agreed to divest its shares in three Danish development projects to its ultimate shareholder, Fredensborg.  The Danish assets are worth c.€100m on a gross basis, with cash proceeds c.€50m.   Heimstaden AB has an earn-out agreement with Fredensborg equaling 30% of any excess return above a 12% IRR hurdle rate.  The transaction is conditional upon the amend and extend.