Catena AB (CATE) climbed to the highest in two years after the Swedish real estate company agreed to be bought by Erik Paulsson’s Brinova Fastigheter AB in return for industrial properties valued at 3.8 billion kronor ($583 million).
The shares rose as much as 20 percent to 103.5 kronor, the highest price since Aug. 2, 2011, and were up 11 percent at 12:30 p.m. local time, the second-biggest biggest gainer among stocks in the OMX Stockholm All-Share index.
In the deal, Catena, based in Gothenburg, will buy Brinova’s Logistics unit with annual rental income of 346 million kronor for a net value of 1.15 billion kronor, less existing liabilities, according to a statement yesterday. The acquisition will be financed through a issue to Brinova of 13.6 million shares at 84 kronor each. Brinova will hold 54 percent of Catena after the deal.
Brinova is controlled by Swedish real-estate investor Paulsson, who holds stakes in companies including resort operator SkiStar AB (SKISB) and commercial property companies Fabege AB (FABG) and Wihlborgs Fastigheter AB. (WIHL) Brinova Chief Executive Officer Gustaf Hermelin will lead Catena after the transaction. The deal covers 43 industrial properties with a lettable area of 655,000 square meters (7.1 million square feet).
The reverse purchase will provide Catena with the financing and know-how for development of its current property stock in the Stockholm suburb of Solna, the company said.
“In terms of size and complexity, Catena’s projects in Solna are such that Catena requires a larger capital and competency base to be able to fully capitalize on the project’s value potential,” Chairman Henry Klotz said in the statement. “Through the transaction with Brinova, Catena will gain these resources.”
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