Samhallsbyggnadsbolaget I Norden Ab Class B · OMXSTO:SBB_B
Samhallsbyggnadsbolaget I Norden Ab Class B — Merger or Acquisition (November 2022)
17 slides from Samhallsbyggnadsbolaget I Norden Ab Class B's merger presentation, Nov 30, 2022
Slide 1: SBB sells a 49% stake in its social infrastructure portfolio for public education to Brookfield
SBB sells a 49% stake in its social infrastructure portfolio for public education to Brookfield for SEK 9.2bn in cash with an additional earn-out of up to SEK 1.2bn in cash ‒ Depending on value of the Earn-Outs achieved, the transaction price represents between a 2.7% discount and a 2.7% premium to
Slide 2: SBB sells a 49% stake in its social infrastructure portfolio for public education to Brookfield
SBB SELLS A 49% STAKE IN ITS SOCIAL INFRASTRUCTURE PORTFOLIO FOR PUBLIC EDUCATION TO BROOKFIELD • Through its open-ended, super core infrastructure fund, Brookfield acquires a 49% minority stake in EduCo from SBB (the “Transaction”) for c. SEK 9.2bn in cash up front, plus up to c. SEK 1.2bn1 in cash
Slide 3: SBB update
SBB 1 SBB update
Slide 4: SBB's leading social infrastructure proposition
SBB’S LEADING SOCIAL INFRASTRUCTURE PROPOSITION Company snapshot Company snapshot Portfolio book value by country Major city regions ✓ SBB operates in the world’s safest asset classes – social infrastructure in the Nordics where 100% of lessees are sovereign or public-financed leaseholders and highl
Slide 5: SBB's majority stake in EduCo forms the basis for SBB's segment social infrastructure for public education
SBB’S MAJORITY STAKE IN EDUCO FORMS THE BASIS FOR SBB’S SEGMENT SOCIAL INFRASTRUCTURE FOR PUBLIC EDUCATION Existing segments: • Low risk, as preschools, primary schools, upper secondary Social infrastructure for schools and universities in the Nordics are publicly funded as Public Education well as
Slide 6: Well progressed deleveraging execution
WELL PROGRESSED DELEVERAGING EXECUTION • Strategy to continue de-levering the business and maintain target LTV below 50% and an ICR of more than 3.0x • On 17 November 2022, SBB completed a c. EUR 500m tender offer for a total EUR 631m in principal amount: ‒ EUR 150m tendered across EUR 3x hybrid not
Slide 7: Transaction rationale
SBB 2 Transaction rationale
Slide 8: EduCo – leading Nordic social infrastructure portfolio for public education
EDUCO – LEADING NORDIC SOCIAL INFRASTRUCTURE PORTFOLIO FOR PUBLIC EDUCATION EduCo Company snapshot Educational portfolio at a glance Educational portfolio breakdown No. of Total GAV Major city regions ▪ Leading social infrastructure portfolio for public education assets (SEKbn) in the Nordic region
Slide 9: Transaction rationale
TRANSACTION RATIONALE EduCo Partnering with Brookfield Strong and predictable, best positions SBB to inflation-secured continue delivering critical cashflows backed by social infrastructure for “AAA” government municipalities within the funding1 public education 1 2 3 4 5 Leading, difficult to repli
Slide 10: The pre-eminent social infrastructure portfolio for public education
1 THE PRE-EMINENT SOCIAL INFRASTRUCTURE PORTFOLIO FOR PUBLIC EDUCATION EduCo Undisputed leader in the Nordic region With several key competitive advantages ✓ GAV of educational portfolio in Europe (SEKmm) Pre-eminent social infrastructure portfolio for public education in the Nordics, fully occupied
Slide 11: Strong and predictable, inflation-secured cashflows backed by AAA government funding
2 STRONG AND PREDICTABLE, INFLATION-SECURED CASHFLOWS BACKED BY “AAA” GOVERNMENT FUNDING EduCo Secured long-dated contracts… …with several key competitive advantages ✓ Typically, no break clauses ▪ Very long leases with existing leaseholders ✓ 10-15 years contract length for newly signed leases ▪ Ne
Slide 12: Essential nature of underlying assets in the Nordics in a market with favorable tailwinds
3 ESSENTIAL NATURE OF UNDERLYING ASSETS IN THE NORDICS IN A MARKET WITH FAVORABLE TAILWINDS EduCo Attractive demographics creating demand Structural undersupply of educational facilities Total general government expenditure in education as a % of GDP (2020A) 55% 2% 5% 38% Sweden’s education market (
Slide 13: Organic and in-organic growth opportunities within the educational sector
PARTNERING WITH BROOKFIELD BEST POSITIONS SBB TO CAPITALISE ON 4 THE ORGANIC AND IN-ORGANIC GROWTH OPPORTUNITIES WITHIN THE EDUCATIONAL SECTOR EduCo 1 Best positioned to lead a Pan-European consolidation 2 EduCo revenue potential SBB average New construction Current geographical focus (SEK/sq.m.) Up
Slide 14: Accelerate deleveraging of SBB's balance sheet with pro-forma LTV of 42%
5 ACCELERATE DELEVERAGING OF SBB’S BALANCE SHEET WITH PRO-FORMA LOAN-TO-VALUE OF 42% FROM 47% AT Q3’22 EduCo Financial target Key ratios evolution LTV LTV Target Loan-to-Value <50% 50% 46% 47% 42% Q2-2022 Q3-2022 Q3-2022 PF 1 ICR ICR Target Interest Coverage 5.6x Ratio 5.1x 4.8x >3.0x >3.0x Q2-2022
Slide 15: Appendix
SBB Appendix
Slide 16: Transaction value overview
TRANSACTION VALUE OVERVIEW EduCo SEKbn Offer elements A Transaction Price, incl. 100% Earn-Outs (SEK 2.4bn) 46.1 • Transaction includes two separate Earn-Outs, expiring after 6 years B (-) Earn-Outs (assumes 50% of max. value of SEK 2.4bn is achieved) 1.2 from the date of the first closing of the Tr
Slide 17: Disclaimer
DISCLAIMER IN REVIEWING THIS PRESENTATION AND ITS CONTENTS, YOU ARE AGREEING TO ABIDE BY THE TERMS OF THIS DISCLAIMER. THIS PRESENTATION AND ITS CONTENTS ARE BEING MADE AVAILABLE TO EACH RECIPIENT SOLELY FOR ITS INFORMATION AND IS SUBJECT TO AMENDMENT. If you are not the intended recipient of this p
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