Fitch Affirms Catena at 'BBB' on Portfolio Acquisition; Outlook Stable

About this update from Catena Ab

Fitch Ratings has affirmed Nordic logistics company Catena AB (publ)'s Long-Term Issuer Default Rating (IDR) at 'BBB' with a Stable Outlook. The rating action follows Catena's announced acquisition of a SEK8.8 billion portfolio comprising 20 modern logistic properties complementing its portfolio in Sweden and Denmark and marking its expansion into Finland . The acquired properties are modern, well-located, have long-term leases and low vacancy. The transaction is funded by a multi-currency bridge loan ( SEK6.7 billion in total) and Catena's cash, which was bolstered by its January 2026 SEK2.75 billion equity raise. We forecast Catena's financial profile will remain robust and consistent with its rating. We forecast Catena's net debt/EBITDA to increase to 8.8x in 2026 before improving to 8.5x in 2027. We annualise rents from the acquired portfolio to calculate Catena's leverage. We expect EBITDA net interest coverage to be comfortable at 3.3x in 2026 and 3.3x in 2027. Key Rating Drivers Logistics Portfolio Acquisition: The acquired SEK8.8 billion logistics portfolio comprises 612,000 square metres (sqm) of space located in Sweden (72% of value), Finland (24%) and Denmark (3%). This quality portfolio complements Catena's own property portfolio and expands its geographical diversification to Finland . The properties have strong green credentials, high occupancy (96.5%) and a long weighted average lease expiry (WALE) of 11 years. Tenants include food logistics Dagab, plumbing and heating wholesaler Dahl and Finnish discount store Tokmanni . The transaction is expected to close in April at a 5.3% net initial yield (NIY). Entry into Finland : The transaction includes SEK2.1 billion of properties in Finland and marks Catena's entry into this market. The portfolio's seven fully-let properties are in southwestern Finland , centred around the country's three largest urban areas of Helsinki , Tampere and Turku . The properties include Tokmanni's new main distribution centre strategically located next to the retailer's headquarters on a long-term lease. Combined Nordic Portfolio: The group's combined SEK53 billion ( EUR5 billion ) logistics portfolio will be split between Sweden (81% of value), Denmark (15%) and Finland (4%). Fitch expects Catena's average WALE to increase to about seven years (end-2025: 6.4) driven by the new portfolio's long leases. The portfolio's tenant base adds several new tenants and has limited overlap with Catena's. These new tenants will reduce Catena's tenant concentration (end-2025, top 10 at 54% of total rents) and its reliance on its largest tenant DSV (18%). Bridge Loan Procured: Catena has procured an unsecured multi-currency bridge loan (in total SEK6.7 billion ) from Nordic banks to fund the acquisition. It has a 12 months' maturity plus a six-months extension option. Catena plans to refinance the bridge loan through a mix of unsecured bonds and secured bank debt. Catena regularly accessed the domestic bond market during 2025 ( SEK1.5 billion in total) in addition to issuing commercial paper. Continued Equity Support: The January 2026 equity raise was completed through a directed share issue to its two largest shareholders Backahill and Warehouses de Pauw NV /SA (WDP, BBB+/Stable), and several Swedish and international institutional shareholders. The equity issue was completed at a 2.7% premium to end-2025 net asset value. Catena's expansion has benefitted from supportive shareholders and the group similarly accessed in total SEK5.2 billion in equity during 2024. Moderating Rental Growth: Catena achieved a healthy like-for-like rental growth of 4% in 2025, down from an inflation-driven 7.6% in 2024 and 11.6% in 2023. Catena maintained its high occupancy at 96.7% and has achieved about 1.5% rental growth above inflation on average over the past four years. Fitch expects modest rental growth in 2026, driven by low 0.9% October 2025 CPI inflation used to index Swedish leases at the start of 2026. Inflation indexation has reduced to 1.6% in 2025 (2024: 6.5%, 2023: 10.9%). More Unencumbered Assets: Fitch expects Catena to issue unsecured bonds as part of the bridge loan refinancing, increasing the share of unsecured debt and creating additional unencumbered properties for the benefit of unsecured creditors. At end-2025, Catena had an unencumbered asset cover of 2.9x (2024: 3.1x), calculated from SEK14.8 billion of unencumbered assets (excluding non-income producing properties and including assets pledged under undrawn revolving credit facilities) compared with SEK4.15 billion of unsecured bonds and SEK0.9 billion of commercial paper. Solid Financial Profile: Fitch forecast Catena's net debt/EBITDA to improve towards 8.5x in 2027, from 8.8x in 2026 pro forma for the acquisition. This will be driven by modest rental growth and investments in its portfolio, supported by retained profits after a moderate 50% dividend payout. Catena's Fitch-adjusted loan-to-value (LTV) was a modest 43% at end-2025. Its financial profile is supported by its use of equity issuance to fund its large acquisitions during 2024-2026. The group retains financial headroom for further growth through developments or acquisitions compared with its 9.5x net debt/EBITDA negative rating sensitivity. Interest Coverage: Catena had short interest-rate hedging at 2.4 years at end-2025 (2024: 2.6). This shorter hedging profile means that Catena's above-3x interest coverage already reflects current interest rates but offers less protection against higher rates. Fitch forecasts Catena's EBITDA net interest coverage to remain above 3x until end-2029, aided by favourable credit margins. Peer Analysis Catena's logistics portfolio is more geographically concentrated than larger pan-European peers SELP Finance SARL (IDR: BBB/Stable), AXA Logistics Europe Master S.C.A , Warehouses de Pauw NV /SA, Montea NV , and smaller CBRE Europe Logistics Partners S.C.A SICAV-SIF (all four rated at BBB+/Stable). This also partly explains its higher top 10 tenant concentration (2025: 54%) compared with WDP's 26% and SELP's 23%, and AXA LEM's and CBRE's about 40%. Catena's financial profile is similar in net debt/rental-derived EBITDA of 8.8x forecast for end-2026 to those of its higher-rated peers WDP (2024: 8.4x), Montea (8.3x) and CBRE (7.5x), while its forecast EBITDA net interest cover of 3.3x is lower than those of WDP (8.0x) and Montea (5.2x). However, Catena's weighted debt maturity (2025: 4.5 years) has historically been shorter than WDP's 5.9 years, Montea's 5.7 years and SEGRO's 6.9 years. Catena had SEK7.1 billion of secured bank debt at end-2025, provided by Nordic banks, typically lending with shorter terms than is common in other bank and bond markets, such as the UK or Germany . Catena combines acquisitions and developments to expand its mixed-size logistics portfolio, whereas SELP Finance SARL predominantly undertakes property developments to expand its portfolio of big-box facilities. When choosing between developments and acquisitions, as the market leader in its domestic market of Sweden , Catena has an intimate knowledge of its area (such as the availability of land or the estimated time to obtain a building permit). This specialisation comes at the cost of lower geographical diversification than pan-European peers. Fitch's Key Rating-Case Assumptions Rental income growth driven by CPI indexation, acquisitions and completion of development projects. Fitch has included annualised rental income, rather than part-year rents from acquisitions and completed projects Occupancy rate to remain stable at 95%-97% (end-2025: 96.7%) to 2029 Capex of SEK1 billion annually until 2029 and SEK500 million in acquisitions, after about SEK10 billion net property investments including capex in 2026. Rental income from new developments at 6% net yield-on-cost Refinancing of maturing debt at interest rates at (i) a policy rates of 2% plus (ii) margins of 150bp-175bp Dividend payout in line with dividend policy at 50% of profit from property management less tax Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using our Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): Management (bbb, Lower), Access to Capital (bbb+, Moderate), Liability Profile (bb+, Higher), Property Portfolio (bbb, Higher), Rental Income Risk Profile (bbb, Moderate), Profitability (bbb-, Lower), Financial Structure (bbb+, Moderate), and Financial Flexibility (bbb+, Moderate). The quantitative financial subfactors are based on standard CRT financial period parameters: 20% weight for the historical year 2025, 40% for the forecast year 2026 and 40% for the forecast year 2027. The Governance assessment of 'Good' results in no adjustment. The Operating Environment assessment of 'aa' results in no adjustment. The SCP is 'bbb'. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Net debt/EBITDA above 9.5x on a sustained basis (end-2025: 8.3x) EBITDA net interest cover below 2.0x on a sustained basis Adverse concentration in debt maturities within 24-36 months 12-month liquidity score below 1.2x Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A more diversified, albeit Nordic, property portfolio Weighted average debt maturity above five years (end-2025: 4.5 years) Lower reliance on secured funding Net debt/EBITDA below 8.5x on a sustained basis EBITDA net interest cover above 2.5x on a sustained basis Liquidity and Debt Structure Catena had SEK3.2 billion in liquidity at end-2025, comprising SEK444 million in readily available cash and SEK2.75 billion of undrawn revolving credit facilities with maturities greater than 12 months. These sources cover its SEK2.5 billion of debt maturities within 12 months. Catena's available liquidity also includes proceeds from its SEK2.75 billion equity increase completed in January 2026 and the bridge loan, which together cover the SEK8.8 billion acquisition cost. The resultant liquidity score is above 1x. Catena's average debt maturity of 4.5 years at end-2025 (2024: 5.2 years) reflects its mix of short-term local Swedish bank debt (about three years), up to five-year Swedish krona unsecured bonds and longer dated Danish mortgage loans. This is longer than the group's stated financial policy of above 2.5 years average debt maturity. The short-term nature of the local bank market is likely to constrain further improvements to the debt profile. Catena's debt at end-2025 was mainly secured (72%). The rest, SEK4.15 billion of unsecured bonds under its medium-term note programme and SEK0.9 billion , was 2.9x (2024: 3.1x) covered by a SEK14.8 billion pool of income-producing unencumbered investment property assets. REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Click here to access Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in our credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. Climate Vulnerability Signals The results of our Climate.VS screener did not indicate an elevated risk for Catena. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit https://www.fitchratings.com/topics/esg/products#esg-relevance-scores . RATING ACTIONS Entity / Debt Rating Prior Catena AB (publ) LT IDR BBB Affirmed BBB Page of 1 VIEW ADDITIONAL RATING DETAILS Additional information is available on www.fitchratings.com PARTICIPATION STATUS The rated entity (and/or its agents) or, in the case of structured finance, one or more of the transaction parties participated in the rating process except that the following issuer(s), if any, did not participate in the rating process, or provide additional information, beyond the issuer's available public disclosure. APPLICABLE CRITERIA Corporates Recovery Ratings and Instrument Ratings Criteria (pub. 03 Aug 2024 ) (including rating assumption sensitivity) Corporate Rating Criteria (pub. 10 Jan 2026 ) (including rating assumption sensitivity) Sector Navigators - Addendum to the Corporate Rating Criteria (pub. 10 Jan 2026 ) APPLICABLE MODELS Numbers in parentheses accompanying applicable model(s) contain hyperlinks to criteria providing description of model(s). Corporate Monitoring & Forecasting Model (COMFORT Model), v8.2.0 ( 09 Jan 2026 , 09 Jan 2026 ) ADDITIONAL DISCLOSURES Dodd-Frank Rating Information Disclosure Form Solicitation Status Endorsement Policy ENDORSEMENT STATUS Catena AB (publ) EU Issued, UK Endorsed DISCLAIMER & DISCLOSURES All Fitch Ratings (Fitch) credit ratings are subject to certain limitations and disclaimers. Please read these limitations and disclaimers by following this link: https://www.fitchratings.com/understandingcreditratings . In addition, the following https://www.fitchratings.com/rating-definitions-document details Fitch's rating definitions for each rating s Read More Solicitation Status The ratings above were solicited and assigned or maintained by Fitch at the request of the rated entity/issuer or a related third party. Any exceptions follow below. Fitch's solicitation status policy can be found at www.fitchratings.com/ethics. Endorsement Policy Fitch's international credit ratings produced outside the EU or the UK , as the case may be, are endorsed for use by regulated entities within the EU or the UK , respectively, for regulatory purposes, pursuant to the terms of the EU CRA Regulation or the UK Credit Rating Agencies (Amendment etc.) (EU Exit) Regulations 2019, as the case may be. Fitch's approach to endorsement in the EU and the UK can be found on Fitch's Regulatory Affairs page on Fitch's website. The endorsement status of international credit ratings is provided within the entity summary page for each rated entity and in the transaction detail pages for structured finance transactions on the Fitch website. These disclosures are updated on a daily basis. (C) 2026 Electronic News Publishing, source ENP Newswire

View stock analysis, news, and events for Catena Ab