The latest information on the rating, including rating reports and related methodologies, is available on this LINK.

Rating action

Scope Ratings GmbH (Scope) has today downgraded Ilija Batljan Invest AB (“IB” or the “company”)’s issuer rating and senior unsecured debt rating to SD, and the company’s SEK 1,350m senior unsecured bond rating (ISIN SE0016101810) to D. The rating on IB’s subordinated hybrid debt remains unchanged at C.

These rating actions conclude the review for downgrade initiated on 29 April 2025. The SD and D ratings assigned today reflect Scope’s determination that an event of default has occurred under Scope’s Credit Rating Definitions.

The full list of rating actions and rated entities is at the end of this rating action release.

Key rating drivers

Today’s rating actions result from a series of sequential actions undertaken by both IB and its creditors since the ratings were last downgraded and placed under review on 29 April 2025. At the time of the review, Scope had indicated that the company’s then-contemplated debt restructuring would constitute a selective default under the agency’s rating definitions, based on Scope’s expectation that the transaction would result in a loss of 40% in the nominal value of affected bond instrument.

Subsequently, IB withdrew its proposed amendments in May due to its inability to secure requisite noteholder consent. The terms of the notes were left unchanged.

Thereafter, Nordic Trustee & Agency AB, on behalf of senior unsecured bondholders, and with the support of a majority bondholder vote declared an Event of Default under a clause in the bond indenture due to the delayed Health Runner merger and accelerated repayment. IB disputed the default, arguing the merger covenant was conditional and in progress. Under the terms of the acceleration clause, repayment of the notes became due immediately at 100% par value plus accrued interest including PIK interest, implying more attractive recovery prospects compared to the company’s prior restructuring attempt. It is Scope’s understanding that IB continues to contest this declaration of default and acceleration as of the date of this press release.

Subsequently, on 5 June 2025, IB launched a tender offer of its bonds at steep discounts, proposing to buy back at 60% of nominal value for its senior unsecured bonds, and at 20% for its subordinated hybrid bonds. The tender was subsequently completed on 26 June 2025, with IB increasing the balance of its senior unsecured notes on its own books by ~3.5% to SEK 479m, and its subordinated hybrid notes by ~40% to SEK 305m. Though voluntary, the transactions qualify as distressed debt exchanges under Scope’s criteria because they: i) impose an economic loss on bondholders, outside the normal course of business, due to a loss of value compared to the original terms of the debt, and ii) have in Scope’s opinion the intent of avoiding a likely payment default or receivership or equivalent proceedings. The repurchase at below par represent a substantial loss of value for the remaining bondholders. Scope views IB as demonstrating a limited willingness to seek alternative solutions that do not disadvantage creditors creating pressure on bondholders to accept the offer.

Scope views the company’s recent distressed debt exchange as constituting a selective default. The trustee’s declaration of default and acceleration events, despite being contested by the issuer, indicate that the instruments also remain in technical default under the terms of the indenture. In addition, liquidity challenges remain a concern, because of the issuer's dependence on external financing, coupled with a persistently elevated leverage (estimated loan/value* ratio of 66% as at 5 June 2025). These challenges are amplified by the issuer's limited market access which raises uncertainty over its ability to repay the upcoming debt maturity in January 2026.

Resolution of the SD issuer rating will most likely require, among other factors, a resolution of the current dispute with noteholders, and satisfactory clarity on the company’s overall funding and business strategy going forward.

Debt ratings

As of YE2024, IB Invest had SEK 80m in unsecured bank debt (ranking structurally ahead of the senior unsecured bond) in addition to the SEK 1,350m senior unsecured bonds (of which, SEK 479m is held by IB on its own books as of August 2025). Those rank ahead of the SEK 750m (of which SEK 305m is held by IB) in subordinated perpetual floating-rate callable capital notes.

Scope has downgraded the senior unsecured debt rating to SD, reflecting the fact that Scope considers the SEK 28.5m bond repurchase on 26 June 2025 to qualify as a distressed exchange on the SEK 1,350m green bond (ISIN SE0016101810). This distressed exchange constitutes an event of default under Scope’s ratings definitions. Accordingly, the rating on the instrument has also been downgraded to D.

Scope has left the subordinated (hybrid) debt rating unchanged at C. Since the issuer can defer interest payments at its sole discretion, and the hybrid bond is perpetual, there exists no payment obligations, and it cannot formally default, resulting in no action and an unchanged C rating.

Environmental, social and governance (ESG) factors

Scope notes the personal attachment of IB Invest's CEO to the core holding SBB i Norden, which has resulted in market value destruction for IB Invest. While Scope understands his role as a founder of SBB i Norden and his continued involvement as a board member, this attachment has culminated in opportunistic trades that have not been in the best interests of IB Invest's stakeholders, raising a governance issue.

All rating actions and rated entities

Ilija Batljan Invest AB

Issuer rating: SD, default

Senior unsecured debt rating: SD, default

Senior unsecured bond (ISIN SE0016101810) rating: D, default

Subordinated (hybrid) debt rating: C, no action

*All credit metrics refer to Scope-adjusted figures.

Stress testing & cash flow analysis
No stress testing was performed. Scope Ratings performed its standard cash flow forecasting for the company.

Methodology
The methodologies used for these Credit Ratings, (General Corporate Rating Methodology, 14 February 2025; Investment Holding Companies Rating Methodology, 16 May 2025), are available on scoperatings.com/governance-and-policies/rating-governance/methodologies.
Information on the meaning of each Credit Rating category, including definitions of default, recoveries, Outlooks and Under Review, can be viewed in ‘Rating Definitions – Credit Ratings, Ancillary and Other Services’, published on scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Historical default rates of the entities rated by Scope Ratings can be viewed in the Credit Rating performance report at scoperatings.com/governance-and-policies/regulatory/eu-regulation. Also refer to the central platform (CEREP) of the European Securities and Markets Authority (ESMA): registers.esma.europa.eu/cerep-publication/. A comprehensive clarification of Scope Ratings’ definitions of default and Credit Rating notations can be found at scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Guidance and information on how environmental, social or governance factors (ESG factors) are incorporated into the Credit Rating can be found in the respective sections of the methodologies or guidance documents provided on scoperatings.com/governance-and-policies/rating-governance/methodologies.

Solicitation, key sources and quality of information
The Rated Entity and/or its Related Third Parties participated in the Credit Rating process.
The following substantially material sources of information were used to prepare the Credit Ratings: public domain, the Rated Entity and Scope Ratings' internal sources.
Scope Ratings considers the quality of information available to Scope Ratings on the Rated Entity or instrument to be satisfactory. The information and data supporting these Credit Ratings originate from sources Scope Ratings considers to be reliable and accurate. Scope Ratings does not, however, independently verify the reliability and accuracy of the information and data.
Prior to the issuance of the Credit Rating action, the Rated Entity was given the opportunity to review the Credit Ratings and the principal grounds on which the Credit Ratings are based. Following that review, the Credit Ratings were not amended before being issued.

Regulatory disclosures
These Credit Ratings are issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0. The Credit Ratings are UK-endorsed.
Lead analyst: Eirik Loevdal Tollefsen, Associate Director
Person responsible for approval of the Credit Ratings: Philipp Wass, Managing Director
The issuer and senior unsecured debt Credit Ratings/Outlook were first released by Scope Ratings on 28 May 2021. The Credit Ratings/Outlook were last updated on 29 April 2025.
The subordinated debt (hybrid) Credit Rating was first released by Scope Ratings on 1 June 2021. The Credit Rating was last updated on 29 April 2025.

Potential conflicts
See scoperatings.com under Governance & Policies/Regulatory for a list of potential conflicts of interest disclosures related to the issuance of Credit Ratings, as well as a list of Ancillary Services and certain non-Credit Rating Agency services provided to Rated Entities and/or Related Third Parties.

Conditions of use/exclusion of liability
© 2025 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Ratings UK Limited, Scope Fund Analysis GmbH, Scope Innovation Lab GmbH and Scope ESG Analysis GmbH (collectively, Scope). All rights reserved. The information and data supporting Scope’s ratings, rating reports, rating opinions and related research and credit opinions originate from sources Scope considers to be reliable and accurate. Scope does not, however, independently verify the reliability and accuracy of the information and data. Scope’s ratings, rating reports, rating opinions, or related research and credit opinions are provided ‘as is’ without any representation or warranty of any kind. In no circumstance shall Scope or its directors, officers, employees and other representatives be liable to any party for any direct, indirect, incidental or other damages, expenses of any kind, or losses arising from any use of Scope’s ratings, rating reports, rating opinions, related research or credit opinions. Ratings and other related credit opinions issued by Scope are, and have to be viewed by any party as, opinions on relative credit risk and not a statement of fact or recommendation to purchase, hold or sell securities. Past performance does not necessarily predict future results. Any report issued by Scope is not a prospectus or similar document related to a debt security or issuing entity. Scope issues credit ratings and related research and opinions with the understanding and expectation that parties using them will assess independently the suitability of each security for investment or transaction purposes. Scope’s credit ratings address relative credit risk, they do not address other risks such as market, liquidity, legal, or volatility. The information and data included herein is protected by copyright and other laws. To reproduce, transmit, transfer, disseminate, translate, resell, or store for subsequent use for any such purpose the information and data contained herein, contact Scope Ratings GmbH at Lennéstraße 5, D-10785 Berlin. Public Ratings are generally accessible to the public. Subscription Ratings and Private Ratings are confidential and may not be shared with any unauthorised third party.