KlaraBo Sverige (KLARA) M&A announcement summary

Deal rationale and strategic fit

• Creates the largest listed residential platform in Sweden with SEK 47 billion in assets and about 26,500 apartments, plus 7,000 in the project pipeline.

• Enhances scale, geographic diversification, and resilience, broadening appeal to domestic and international investors.

• Increases income from property management per share by 16% and strengthens cash flow resilience.

• Reduces operational risk by increasing the share of income-generating assets and lowering exposure to development properties.

• Strengthens market position, making the combined entity more than twice the size of the next largest listed residential company in Sweden.

Financial terms and conditions

• Merger executed at NAV for both companies; exchange ratio set at nine Sveafastigheter shares for 22 KlaraBo shares.

• KlaraBo to pay an extraordinary dividend of SEK 1.4 per share to existing shareholders, conditional on merger approvals.

• KlaraBo acquires a SEK 7 billion property portfolio from SBB, financed via a share issue at NAV; SBB receives merger consideration in Sveafastigheter shares.

• Post-merger ownership: 65% Sveafastigheter shareholders, 20% KlaraBo shareholders, 15% SBB; combined company will have 302.9 million shares outstanding.

• Merger plan subject to approval by at least two-thirds of votes and shares at each company’s EGM, expected in late June.

Synergies and expected cost savings

• Annual operational synergies estimated at a minimum of SEK 120 million, including SEK 55 million from property costs and SEK 30 million from central administration.

• Financial synergies of at least SEK 35 million annually expected from improved credit profile and refinancing.

• Synergies expected to be fully realized within 12 months post-merger registration.

• One-off integration costs estimated at SEK 5 million.