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Samhallsbyggnadsbolaget – Contingent Liabilities

Author: Published on: Published in: Samhallsbyggnadsbolaget STO:SBB

March 22, 2022 – Perusal of SBB’s transactional counterparty financial accounts show significant contingent assets stemming from sales to SBB, which appear to be performance/event driven.

SBB do not appear to recognize contingent liabilities to these transactional counterparties anywhere in its financial reports, creating a material audit risk of huge off-balance sheet liabilities from its aggressive acquisition strategy. Laeringsverkstedet parent Dibber AS’s 2020 accounts show:

  • NOK500m in unpaid consideration for the sale of 138 properties, with conditions expected to be met for the payment.
  • A contingent consideration of NOK250m dependent on future events.

Viceroy Research cannot immediately reconcile all these contingent liabilities to SBB in the same year. As usual, there is absolutely no transparency into SBB’s aggressive acquisitions, and their terms.

Investors, auditors, and transaction stakeholders should be aware of contingent liabilities (or assets) and how SBB are treating these accounts.

The existence of contingent liabilities has not even been disclosed by SBB, which is not a surprise given the insufferably opaque nature of SBB. We have contacted SBB’s auditors for questions surrounding the recognition, existence, and reversal of SBB undisclosed contingent liabilities.

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