Tessin secures SEK 150 million in institutional capital – issues participating loan
Image: Christian Gustavsson
Tessin secures SEK 150 million in institutional capital – issues participating loan
Stockholm, Sweden- Tessin Nordic AB (publ) (NASDAQ: TESSIN B) – The leading digital platform for investments in real estate projects in the Nordics announces that the company has secured capital of SEK 150 million to be invested in secured property credits via the Tessin platform. The participating loan will be issued to Praktikertjänst, a leading Swedish institutional investor. Arranged by DNB Markets, the participating loan will be invested within the framework of Tessin Capital operations.
“We are seeing a sharp rise in demand for significantly higher value loans from larger, more established companies in the real estate market. With access to the capital represented by the participating loan, we are now a serious competitor to conventional banks in helping Swedish property developers secure financing during the project term”, says Heidi Wik, CEO of Tessin Nordic Holding. “Creating structures that give us access to institutional capital is a key factor in our growth strategy, as it gives us flexibility that we did not have previously, when we exclusively brokered capital provided by platform members.”
The participating loan is the initial result of several strategic discussions ongoing with institutional investors. Augmenting institutional sources of capital equips Tessin to offer financing solutions and loans above SEK 100 million to property developers.
“With the investment from Praktikertjänst, Tessin is moving up significantly in the value chain and can finance and facilitate considerably larger projects to meet the capital needs of project owners who are, for example, fighting to build away the housing shortage in Sweden”, says Ms Wik.
“Tessin is a trustworthy provider in the sector with an efficient credit process and a strong track record. The financing arrangement gives us exposure to a high-yield niche in the credit market, with controlled risk”, remarks Mattias Ledunger, CEO of Praktikerinvest.
DNB Markets acted as financial adviser to Tessin and structured and brokered the participating loan. The law firm of Eversheds Sutherland acted as legal adviser.
About the participating loan
Tessin Capital (a wholly owned subsidiary of Tessin Nordic Holding AB), through a subsidiary, is issuing a participating loan of SEK 150 million to Praktikertjänst through Praktikertjänst AB’s Pensionsstiftelse and Praktikerinvest. The participating loan will accrue a fixed annual coupon at 5 percent interest and participation in the excess return, with an estimated total return of approximately 7 percent.
Tessin Capital and capital partners will provide SEK 22.5 million in the structure for a total investable amount of SEK 172.5 million. The entire amount will be invested on an ongoing basis in secured property loans brokered by Tessin Nordic AB (publ).
The participating loan was structured by DNB Markets.