Interim report january - september

Interim Report from Drott AB (publ) January 1 - September 30, 1998 * Drott share listed on the Stockholm Stock Exchange as of September 24 * Acquisition of Näckebro * Strong financial position and cash flow * Proposed redemption of acquired Drott shares Contents Since the acquisition analysis regarding Näckebro was only recently initiated, Näckebro is not included in Drott´s nine-month report. To provide an illustration of the new Drott Group, a pro forma review of the situation at June 30, 1998 is provided, as well as Näckebro´s own nine-month report. 1. Significant events 2. Drott´s income statement and balance sheet at September 30, 1998 3. Ownership structure 4. Definitions 5. Information about Drott Appendices I. Review of the Drott Group, including Näckebro, at June 30, 1998 II. Nine-month report from Näckebro Drott AB is a pure real estate company focusing on Sweden. As of September 24, 1998, the Drott share is listed on the O-List of the Stockholm Stock Exchange. Drott has approximately 57 000 shareholders. The Company´s task is to provide a return on shareholder capital, through management of its own properties and active utilization of the balance sheet (dividends, share redemption, real estate transaction, etc.). Drott and Näckebro jointly own approximately 500 management properties with total rentable floor space of 2.9 million sq.m., of which residential properties account for about 1.2 million sq.m. The new Drott Group´s properties have a rental value of approximately SEK 2.5 billion, with the Stockholm region accounting for about 45%. 1. SIGNIFICANT EVENTS January - September 1998 January Drott Group formed through Skanska´s combination of a number of properties and property owning companies into a new legal structure. April Skanska´s Annual General Meeting resolved to distribute all shares in Drott AB to Skanska´s shareholders. September Custos, Industrivärden and Handelsbanken´s pension foundations sold their Drott shares (10.7% of the share capital and 44.6% of the voting rights in Drott) under futures contracts to Näckebro. Näckebro announced that it acquired these high-vote shares with a view to implementing a merger of the two companies. September Drott made a public offer for all of the shares in Näckebro at a 1 price of SEK 141 per share (total of approximately SEK 3.4 billion). September The Drott share was listed on the O-List of the Stockholm Stock Exchange as of September 24. September During September, Drott acquired approximately 16 million Näckebro shares, corresponding to 67.1% of the share capital and voting rights. 1 The bid was raised from SEK 126 to SEK 141 per share on September 8. Following the report period October Drott and Näckebro reached an agreement regarding a merger. Owners of more than 97% of the share capital and voting rights in Näckebro accepted Drott´s offer. Compulsory redemption of the shares outstanding was requested. November The Näckebro share was delisted from the Stockholm Stock Exchange, as of November 3. November Drott´s Board of Directors decided, among other measures, to * propose to the 1999 Annual General Meeting that Drott´s equity be reduced by an amount corresponding to the value of the Drott shares acquired by Näckebro * propose that, in the near future, senior executives within the Drott Group will be offered an opportunity to participate in a program of incentives in the form of synthetic options * that as of January 1, 1999, Drott will be included in the Swedish Real Estate Index. ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1998/11/04/19981125BIT00090/bit0001.doc http://www.bit.se/bitonline/1998/11/04/19981125BIT00090/bit0002.pdf