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Banks grant YIT a 140 million euro loan with limitations on dividend payouts

ByEditor

Nov 22, 2023

Construction company YIT plans to use a new loan of 140 million euros to replace existing loans totaling 150 million euros that are due by the end of the year and next spring. YIT has recently announced that it has signed a loan agreement with the banks and that the new loan matures in April 2025.

The loan agreement contains restrictions on the distribution of funds, financial key covenants related to the company‚Äôs solvency, interest margin, and debt ratio. Due to the company’s tighter financial situation, YIT’s board of directors has decided not to propose a profit distribution for the current year’s financial year, and instead is focusing on strengthening its financial position.

YIT has faced challenges this year due to a slowdown in the housing market. The company has not been able to sell the apartments it has built, which in turn has led to an increase in the number of unsold completed apartments. The company’s gearing ratio has also increased to one hundred percent, compared to 69 percent a year ago.

The new loan agreement has been coordinated and organized by OP Yrityspankki and SEB, with Swedbank participating as the third main organizer. YIT is also undertaking a change program to improve the use of its capital and plans to sell its assets and operations for around 400 million euros by the end of next year.

By Editor

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