Scandinavian Property Development (SPDE) offers 60 percent discount on rights issue

As a condition of its refinancing efforts, Scandinavian Property Development has been forced to issue NOK 700 million new shares priced at NOK 1.00 each, a 60% discount to recent market levels. The company, which is listed on the Oslo Børs under the ticker symbol SPDE, was started in March 2007 with the acquisition of the Fornebu development project and has nearly 700,000 sqm of development potential in its portfolio.

The company's stock closed on June 24th, 2009, at NOK 2.52 with 80 million shares outstanding and a market capitalization of NOK 201.6 million. The NOK 1.00 share issue price is below the 52-week low of NOK 1.50 and dilutes the existing shareholders down to 10% of the equity ownership.

Though the subscription period for the share issue lasts only a few hours, the company reports that it has already secured "significant pre-commitments" from large shareholders such as Orkla (who owns 33% of the company), OBOS (12.4%) and Canica (2.9%). The rationale for the private placement, led by SEB Enskilda, is outlined in the Private Placement Presentation.

Company Announcement: English Norwegian