The Swedish car importer Hedin Mobility, which in recent years has acquired several companies in Denmark, risks having a number of loans canceled after billions in losses in the last quarter.
The Swedish car importer Hedin Mobility, which owns a number of Danish companies, is facing a loss of billions.
The group, which has had major financial problems this year, is in breach of its bond terms due to the poor accounts and risks having a number of large loans cancelled.
This is what Dagens Industri writes.
Hedin Mobility has lost significant sums on car sales over the course of the year, and in the third quarter alone the loss was 112 million kroner in Sweden.
Including interest costs of 1.2 billion Swedish kroner (approximately 780 million Danish kroner, ed.), the group's total loss ends up being over one billion kroner.
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In order to finance a rapid expansion, Hedin Mobility issued a bond of one billion kroner last year.
The loan terms dictate that the net debt in the company must be below 2.75 times the operating profit. But the debt has now increased to 17.73 times the operating profit, writes the Swedish media.
The interest coverage ratio, which indicates how many times the profit covers the interest, has fallen from three times to 0.32 times the profit.
The situation forces Hedin Mobility to ask the lenders to postpone a number of requirements in the loan agreements to avoid an immediate repayment.
– They probably need a capital injection from the owners, says DI's expert Magnus Dagel.
– In the course of the past year, car brands have significantly reduced the prices of new electric cars. Which negatively affects the possibility of earning from existing stocks as well as buyback obligations for leased cars, says managing director Anders Hedin.
At home, the Swedish car giant has among other things acquired the import of Iveco and the Danish BMW specialist Koed A/S.
Earlier this year, Hedin withdrew from the German market when the import of Chinese BYD was sold back to BYD itself. Read more about it here .
