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Financial information
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Credit matters
Credit matters
Organization
Industrivärden's financing and management of financial risks are conducted in accordance with guidelines set by the Board of Directors. Industrivärden's finance function works primarily with financing and investment of surplus liquidity.
Financing
Industrivärden's financing is arranged through both short- and longterm borrowing. The credit facilities give Industrivärden the ability to act on attractive investment opportunities at short notice. No part of the financing is conditional upon any covenants.
Convertible loans
In January 2010 Industrivärden issued a fiveyear convertible loan worth EUR 500 M, which was oversubscribed. The aim was to take advantage of strong market conditions and good credit quality to obtain attractive financing with the opportunity to issue new equity. The convertible loan issue has increased Industrivärden’s financial flexibility and preparedness to act on attractive investment opportunities.
In January 2011 Industrivärden issued a sixyear convertible loan worth EUR 550 M in order to further increase its financial flexibility.
Industrivärden has two outstanding convertible loans. The complete terms are accesseble below. Further information can be found at Corporate Governance/Annual General Meeting/2010 Extra and 2011 Extra.
Terms
Terms and conditions 2017
Terms and conditions 2015
Credit facilities as per December 31, 2011
| |
Amount,
SEK M |
Utilized amount,
SEK M |
Term
|
| Convertible loans |
8,555
|
|
8,555
|
2015-2017
|
|
Bank loans
|
5,211
|
4,711
|
2013-2017
|
|
MTN program
|
8,000
|
600
|
2014
|
|
Total long-term borrowing
|
|
13,866
|
|
| Bank loans |
--
|
500
|
|
|
MTN program
|
--
|
800
|
|
|
Commercial paper
|
2,000
|
1,200
|
|
|
Bank overdraft facility
|
1,000
|
419
|
|
|
Total short-term borrowing
|
|
2,919
|
|
In addition Industrivärden has unutilized committed bank loans totaling SEK 2,000 M.
Average interest rate and interest duration
The average interest rate for Industrivärden's debt portfolio as per December 31, 2011, was 3.5% (3.8%). The average interest duration was 42 months (43).
Liquidity analysis
Maturity structure for undiscounted, contracted interest-bearing receivables and liabilities and derivative instruments along with future interest payments accruing there with:
|
SEK M
|
2012
|
2013-2016
|
After 2016
|
Total
|
| |
|
|
|
|
|
Interest-bearing receivables
|
7
|
19
|
--
|
26
|
|
Interest-bearing liabilities
|
-3,465
|
-8,972
|
-7,184
|
-19,621
|
|
Derivative instruments
|
-48
|
-7
|
--
|
-55
|
|
Total as per December 31, 2010
|
-3,506
|
-8,960
|
-7,184
|
-19,650
|
| |
|
|
|
|
|
SEK M
|
2011
|
2012-2015
|
After 2015
|
Total
|
| Interest-bearing receivables |
14
|
210
|
--
|
224
|
|
Interest-bearing liabilities
|
-2,774
|
-9,356
|
-3,279
|
-15,409
|
|
Derivative instruments
|
-13
|
-4
|
--
|
-17
|
| Total as per December 31, 2010 |
-2,773
|
-9,150
|
-3,279
|
-15,202
|
Change in the group´s interest-bearing net debt
| SEK M |
Dec 31, 2011 |
Change in borrowing |
Other changes |
Dec 31, 2010 |
| Cash and cash equivalents |
57 |
-- |
57 |
0 |
| Interest-bearing receivables |
33 |
-- |
-147 |
180 |
| Non-current interest-bearing liabilities |
13,947 |
2,824 |
-- |
11,123 |
| Current interest-bearing liabilities |
2,923 |
634 |
-169 |
2,458 |
| Interest-bearing net debt |
16,780 |
3,458 |
-79 |
13,401 |
Rating
Industrivärden has been assigned international corporate credit ratings of A-/Stable/A–2 by Standard & Poor’s, which has also assigned the commercial paper program a credit rating of K-1.
Financial risk management – general
The types of financial risks that the Industrivärden Group encounters in its business consist primarily of equities risk and – to a limited extent – other financial risks in the form of interest rate risk and liquidity risk. See Corporate governance/Risk management.