Founder of embattled Swedish landlord SBB steps down as CEO

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Founder of embattled Swedish landlord SBB steps down as CEO

In a dramatic move, Ilija Batljan, the founder and dominant shareholder of embattled Swedish landlord SBB, steps down as chief executive officer in a dramatic shift that highlights the uphill battle he faces to save his $13 billion empire.

In a statement, Batljan, who was founded Samhallsbyggnadsbolaget i Norden AB in 2017 and is expected to hand off executive responsibility as of June 5, the Stockholm-based company said in a statement. Leiv Synnes, who has served as chief financial officer of Akelius Residential Property AB since 2014, has been appointed by the government. As much as 69% of shares sank after trading resumed in Stockholm.

As the founder and a major shareholder in SBB, Batljan said it is my role to take responsibility in a challenging time. My faith in SBB is still strong. Batljan, 55, played a crucial role in the company's rapid, debt-fuelled expansion and became the center of the company's turmoil. The former refugee's credibility was damaged by a series of statements dismissing the company's weaknesses. Just days before a downgrade of the company s credit rating to junk status, he said SBB met all the criteria to have S&P Global Ratings drop its negative outlook.

As of April 26th, 3% of SBB shares and almost 32% of the votes in SBB, according to the company's website. His investment firm said yesterday that it will postpone the release of its quarterly report to June 9 from May 31. Invest AB recently deleted interest payments on its hybrid bonds.

The surprise move came after Batljan visited London this week and spoke to a number of investors about selling individual assets as well as the entire company, a person familiar with the process said. Brookfield Asset Management, Canada's investment group, is among investors involved in early stage talks to evaluate the real estate firm s portfolio, said other people who asked not to be identified as the meetings were not public.

Analysts are expected to see a full sale unlikely, and buyer interest is expected to focus on assets such as SBB's elderly care homes and residential units. The company's poor prospects have raised political concerns, given its ownership of many public-sector buildings.

The Stockholm-based firm has declined to comment on the process when contacted by Bloomberg News. Brookfield declined to comment.

The landlord is urged to find cash as the stock has dipped to the lowest level since its debut in 2017 - the worst in the history of the rental business. The company has already halted some hybrid bond coupons, scrapped a dividend and emergency rights issue, and has even hired the services of JPMorgan Chase Co and SEB AB to drum up some support.

With Leiv Synnes as the new CEO, SBB gains a new, highly qualified force that can manage the company with full focus and support the board of directors in the strategic review, said Chairman Lennart Schuss.