
The company has classified the production buildings
and land placed in Bjuv municipality and the connected
mortgage loan, as held for sale on 31. December 2024.
The book value of assets held for sale was MNOK
13.9, and the related mortgage debt was MNOK 44.2.
The reason for the re-classification is that Höganäs
Bjuf Fastighets AB, an indirect subsidiary of Borgestad
ASA, on 27. October 2023 entered into a conditional
agreement with Bjuv municipality in Sweden for a sale
and leaseback transaction for two properties in Sweden
where the production plant and other production
facilities for refractory products are located.
It is currently unknown when and if the appeal will be
processed by the Court of Appeal, and it cannot be
ruled out when a decision will be reached. If the Court
of Appeal rules in favour of the claimant, the transaction
cannot be completed.
Conditional of completion of the sale leaseback
transaction is an additional reduction of the interest-
bearing debt, with MNOK 44.0.
Several factors can have an unfavourable impact on
Borgestad’s operations and future value development.
These factors include financial risk, including interest
rate, currency and credit risk, risk related to operations,
market risk, environmental and legal risk, as well as risk
related to the individual projects in which the Group
has investments. The Group’s biggest financial risk is
linked to Agora Bytom where the Group has a net equity
investment that is exposed to value fluctuations in the
Polish property market. In recent years, Agora Bytom
has reduced its debt significantly and currently has the
lowest debt in the centre’s history, which reduces the
Group’s overall risk.
Borgestad will sell the two properties, including the
production facilities, to Bjuv municipality and then lease
the production facilities needed. The company will after
the completion of the transaction still be the owner of all
machinery and equipment used in the production.
The two properties are in the transaction valued at
MSEK 145 and the purchase price will be approximately
MSEK 141.2 after adjustment for stamp duty. The
purchase price shall be settled with cash in three
instalments; 60 percent will be payable upon completion
of the transaction, 20 percent will be payable 12 months
after completion, and the remaining 20 percent will be
payable 24 months after completion.
Liquidity risk is the risk that the Group will not be able to
service its financial obligations as they fall due. Höganäs
Borgestad group had mortgage debt of MNOK 53.0
as of December 31, 2024, of which MNOK 44.0 falls
due end of June 2025 towards Nordea Bank ASA. The
Board of directors review the refinancing risk as low and
management has agreed with Nordea that discussion
related to refinancing will be completed during first half
of 2025. The board and Group management have the
understanding that the Group’s liquidity is strong and
that the Group is in a good position to service the debt
within the Group as it falls due.
The transaction was approved by the Municipal
Council of Bjuv 11 December 2023, but a complaint
regarding the approval from Bjuv municipality has
been received prior to the expiration of the appeal
period. The complaint relates to the purchase price in
the transaction and that this, in the claimant’s opinion,
significantly exceeds the market value of the two
properties. The Administrative Court in Malmö (the
“Administrative Court”) has processed the complaint.
According to the Administrative Court, Bjuv municipality
has not provided sufficient documentation regarding
the valuation of the two properties. As a result, the
Administrative Court has decided to revoke Bjuv
municipality’s approval of the Transaction.
In the board of directors and managements view the
company has per December 31, 2024 a sustainable
balance sheet and cash position and is fully financed.
Borgestad ASA has entered into a liability insurance for
the board and management with a liability limit of MNOK
25. The insurance covers the board’s legal personal
liability for financial damage caused by the performance
of their duties and associated expenses with a court
case or similar. The coverage also includes boards and
management in subsidiaries of Borgestad ASA (with an
ownership stake of over 50 per cent) and employees who
represent Borgestad ASA at external boards of directors.
Bjuv municipality has in March 2025 appealed the
Administrative Court’s ruling.
The approval of the transaction by Bjuv municipality
will only become binding once the complaint has been
finally resolved in the claimant’s disfavour, and the
completion of the transaction is conditional upon such
binding approval.