The news of the listed company Eagle Filters could have been lost in Thursday’s rush of earnings news.
According to an external evaluator Eagle Filtersin the fair value of the industrial property in Kotka owned by the subsidiary is 4.4 million euros. Eagle Filters bought the property last year and paid only 0.3 million euros for it then, so the value determined now is almost 15 times the purchase price.
It is a traditional UPM:n the former Hovinsaari factory area in Kotka. The property was auctioned last year, and the highest bid at the auction was 275,400 euros from Eagle Filters. The property was sold by its then owner, a real estate investment company from Lahti EMP-Invest.
According to Yle the bidding reached the last minutes, during which the price of the item doubled. A total of 107 offers were received. There were seven buyer candidates.
CEO of Eagle Filters Jarkko Joki-Tokolan according to the property is in industrial use, and Eagle Filters carries out industrial activities there.
“Eagle Filters is there itself for rent. The estimate ordered now is independent and based on what kind of rental demand there is. There are other tenants in the area than Eagle Filters,” says Joki-Tokola.
“You have to ask the seller why it was so cheap. We also saw it as a significant opportunity. There are 23,000 square meters and 6.5 hectares, 275,400 euros is not the right price, but we shouted and won.”
Eagle Filters Group is an investment company formerly known as Loudspring, whose subsidiary Eagle Filters is a technology company specializing in air filtration.
Compared to the size of the company, the increase in the property’s value of 4.1 million euros is significant. Eagle Filters’ market value on the stock exchange is less than 10 million euros. The equity of the company’s balance sheet at the end of 2023 was approximately EUR 900,000.
He made an estimate of the property’s value Newsec Advisory Finland.
“My understanding is that they are looking at the pricing in that area and the leases that are there.”
According to Joki-Tokola, they specifically wanted an experienced and respected operator as an evaluator.
“I know that at the bottom of the closet you can find an estimate to make someone who will do it however it hurts. We wanted the strongest operator, so that we really know what the value is and can tell it to the market and shareholders.”
On the Inderes investment forum, the valuation of the property sparked comments about accounting gimmicks and beautifying equity. Is the increase in valuation recorded in the balance sheet’s equity?
“Decisions have not been made, and by no means fully, and we will act very carefully if this is done”, Joki-Tokola answers.
“We have an obligation to inform the market and shareholders.”
Eagle Filters has been loss-making for a long time, its equity ratio is weak and its indebtedness is at a high level. Last year, however, the company managed to grow strongly, and the turnover increased to 6.0 million euros from 3.6 million the previous year. In the current year, it has said that it will focus on achieving profitability in addition to growth.