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Real estate company Solon Eiendom announced Friday morning that the company signed an agreement to sell its 49 percent stake in Solon Realkapital to Vatne Property.
Investor Runar Vatne already owns 51 percent of Solon Realkapital, which is the land bank of Solon Real Estate.
The company explains the sale as part of strategic changes.
Co-founder Simen Thorsen is the largest owner of Solon Eiendom. Investor Runar Vatne is the second largest owner through his Vatne property.
Solon Realkapital is a collaborative project between Solon and Vatne Property, which was established to buy Solon Eiendom apartments and other real estate projects, the company writes in the stock exchange announcement.
Solon’s interest bearing debt in Solon Realkapital is approximately NOK 40 million and upon completion of the deal will result in a cash payment of NOK 7 million to Solon.
The Solon Realkapital portfolio consists of 114 different units across three different Solon projects.
Refs by Finanstilsynet
In May, it emerged that the publicly traded Solon Eiendom had sold housing projects for $ 500 million to Solon Realkapital. However, real estate transactions were not recorded in Solon Eiendom’s accounts. This was possible because Solon Eiendom owned less than half of the company, that is, 49 percent.
The transactions drew strong criticism from Finanstilsynet.
«In the valuation of Finanstilsynet, the annual report must analyze the figures recorded to a greater extent, and a more precise mention must be made of the purchase and sale contracts concluded with Solon Realkapital. Finanstilsynet has further stated that the annual report must contain a sufficient description of the most central risks and uncertainties associated with transactions with Solon Realkapital, see Accounting Law § 3-3a ”, the November report states.
Finanstilsynet considered that the annual accounts do not contain sufficient information on the principles used to recognize and measure the investment in Solon Realkapital.
Loss of 178 million in 2020
The third quarter quarterly report revealed that Solon Eiendom lost 178.1 million NOK in 2020, compared to a gain of more than 140 million NOK in the first nine months of 2019.
At the end of the third quarter of 2020, the company had 963 units under construction, of which 73 percent had been sold. 112 units were completed, while 118 units were delivered during the quarter.
– We consider the evolution of the part of the housing market in which Solon Eiendom operates to be positive. The group continues its growth strategy based on the strong demographic drivers that the group has observed in recent years. The market still appears to be differentiated with good demand for quality homes with attractive locations and good architecture, the report notes.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content can only be done with written permission or as permitted by law. For more terms, see here.
