S&P slashes SBB on tender offer

S&P said it lowered its ratings on Samhallsbyggnadsbolaget i Norden AB to SD, Selective Default, and its senior unsecured bonds due in 2027, 2028, and 2029 to D from CCC+, citing the results of its tender offer. The agency also downgraded to CCC from CCC+ the senior unsecured notes due in 2025 and 2026.

SBB allocated about €163 million in cash to buy back three euro-denominated hybrid subordinated notes and its senior unsecured bonds due in 2027, 2028, and 2029 at prices well below par. The nominal amount repurchased is €408 million.

The lenders will get less than half of what they were promised and therefore the agency said it considers the offer the equivalent of default.

“We lowered our ratings on the 2025 and 2026 notes that were not subject to the tender offer to CCC from CCC+. Although we do not consider these issuances to be defaulted, the potential for a default on these instruments has risen. Even after the discounted tenders on the other bonds, SBB's liquidity will be weak and it has sizable short-term debt maturities,” S&P said in a press release.

Once the offer settles, the agency said it plans to upgrade SBB and its debt ratings to CCC.

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