(Bloomberg) -- Swedish landlord Oscar Properties Holding AB has averted insolvency after it reached a settlement with one of the creditors seeking a bankruptcy claim against the company.
In a day of high drama, the insolvency ruling was pushed back to 2 p.m. Stockholm time from 11 a.m. while the owner of industrial units and offices reached a settlement deal with the claimant Brf Innovation.
With debt totaling 1.8 billion Swedish kronor ($171 million) — including bank loans of 354 million kronor and local currency bonds worth a nominal 1.4 billion kronor — a potential bankruptcy of Oscar Properties would have been fairly manageable for a country that has been viewed as the epicenter of Europe’s real estate meltdown. Oscar, like many commercial landlords in Sweden, was caught wrong-footed by falling valuations and a jump in borrowing costs after loading up on debt during the era of cheap money.
Now the landlord says it plans to sell shares to claimants in order to move forward and shore up its finances. The issue will be guaranteed by existing shareholders and external parties, according to a statement on Monday.
“I have been in talks with a reputable investment bank about the next step,” said Oscar Properties Chief Executive Officer Richard Bagge. “The plan is to go out with a rights issue.”
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