Heimstaden financing falls into place after €9.1bn Akelius deal
Just over a week after Malmö headquartered Swedish housing specialist Heimstaden Bostad announced that it is to pay Germany’s Akelius SEK 92.5 billion (€9.1 billion) for a portfolio of 28,776 homes in Germany, Sweden and Denmark and the company has clarified some of the financing arrangements with a bond issue while also refinancing a facility on another portfolio with Berlin Hyp.
Heimstaden Bostad has announced the issue of €2.75 billion in fixed rate senior unsecured bonds under its EMTN programme. The bonds have maturities of three, six and a half and ten years and carry annual coupons of 0.25%, 1.00% and 1.625% respectively. Heimstaden is expecting ratings of ‘BBB’ by S&P and Fitch for the bonds.
The company has also issued a €600 million subordinated perpetual hybrid bond with an annual fixed rate coupon of 3.625% and a next reset period of 5.25 years. The bond will be accounted for as 100% equity by Heimstaden Bostad in accordance with IFRS. S&P and Fitch will classify the bond as having intermediate (50%) equity content and have assigned a ‘BB+’ rating to the issue.
Bond issue attracts ‘broad institutional base’
The company said the bonds attracted strong interest from a broad institutional base demonstrated investors’ support for the acquisition. The company has applied to have the bonds listed on Euronext Dublin.
BNP Paribas, Citi, Danske Bank, Deutsche Bank, ING, J.P. Morgan, Nordea, Nykredit , Svenska Handelsbanken, Swedbank, Unicredit acted as Joint Bookrunners.
Heimstaden has also obtained a €240 million investment loan from real estate and mortgage bank Berlin Hyp. The ten-year loan is to refinance a residential portfolio in the Charlottenburg-Wilmersdorf, Friedrichshain-Kreuzberg, Lichtenberg, Mitte, Neukölln, Pankow, Reinickendorf, Spandau, Steglitz-Zehlendorf, Tempelhof-Schöneberg and Treptow-Köpenick districts of Berlin.
The portfolio comprises a total of 63 fully rented properties with a total lettable area of 138,100 sq m.
