Make Kitco Your Homepage

Swedish property group SBB replaces CEO as searches for buyers

Kitco News

HELSINKI, June 2 (Reuters) - Debt-laden Swedish real estate company SBB (SBBb.ST) said on Friday its founder and CEO Ilija Batljan has stepped down and will be replaced by industry veteran Leiv Synnes as the board seeks to divest assets or find a buyer for the group.

SBB's share price surged 50% to trade at 5.18 Swedish crowns by 1307 GMT, but is still down more than 70% year-to-date.

Hit by soaring interest rates that forced the company to cancel its dividend and scrap a share issue, SBB on Monday said it was broadening a strategic review to consider a sale of all or parts of the company.

Synnes leaves his position as chief financial officer at rental property company Akelius (AKELd.ST), where he has held several jobs in the last 19 years.

"With Leiv Synnes as the new CEO, SBB gains a new, highly qualified force that can manage the company with full focus and support the board of directors in the strategic review," SBB Chair Lennart Schuss said in a statement.

Several ratings agencies have downgraged SBB's debt to so-called "junk" status in recent weeks and Swedish policymakers worry more broadly about the risks of falling property values.

"As the founder and a major shareholder in SBB, it is my role to take responsibility in a challenging time," Batljan said in the statement, adding he would continue as a board member at SBB.

Moody's said this week it had taken negative rating action on about 50% of the real estate firms it covers in Sweden, and the Swedish central bank has called on industry players to improve the health of their balance sheets.

Reporting by Essi Lehto, editing by Terje Solsvik and Emelia Sithole-Matarise
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.