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BASIC INDUSTRIES: Stora (STERV Baa3/NR/BBB-): Asset Sales

BASIC INDUSTRIES
BulletCredit Bullets

Credit positive, further work needed, however.

  • Stora announced plans to sell Swedish forest assets, which could be worth around €930mn based on FY23 prices.
  • They intimate proceeds will be used for debt reduction. FY24 leverage could be reduced around 0.7x on that, taking gross leverage to 3.6x expected.
  • Moody’s had adj. leverage at 4.2x vs 3x headline at 1H23. Applying the same 1.2x differential would put Moody’s at 4.8x; they have a 3.5x threshold for downward ratings pressure.
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Credit positive, further work needed, however.

  • Stora announced plans to sell Swedish forest assets, which could be worth around €930mn based on FY23 prices.
  • They intimate proceeds will be used for debt reduction. FY24 leverage could be reduced around 0.7x on that, taking gross leverage to 3.6x expected.
  • Moody’s had adj. leverage at 4.2x vs 3x headline at 1H23. Applying the same 1.2x differential would put Moody’s at 4.8x; they have a 3.5x threshold for downward ratings pressure.