Group equity
Share capital
Stedin Holding N.V.’s authorised share capital is €2 billion, divided into 15 million ordinary shares and 5 million cumulative preference shares with a nominal value of €100 each. At 31 December 2021, 5,387,046 shares, of which 4,970,978 ordinary shares and 416,068 cumulative preference shares, had been issued and fully paid (2020: 4,970,978 ordinary shares only).
Share premium
Stedin Holding N.V. raised €200 million in additional equity in 2021 to strengthen the equity capital position. This was raised by issuing 416,068 cumulative preference shares with a nominal value of €100 each. In addition, the shareholders paid in share premium of €380.69 per share, for an aggregate amount of €158.4 million.
Revaluation reserve
The revaluation reserve relates to the revaluation of networks and network-related assets at fair value. The difference between depreciation based on the revalued book value and depreciation based on the original historical cost, less deferred tax, was transferred from the revaluation reserve to retained earnings. The revaluation reserve is not freely at the disposal of the shareholders. The revaluation reserve amounted to €790 million at year-end 2021 (2020: €662 million). In 2021, €176 million was added to the revaluation reserve as a result of the revaluation of property, plant and equipment. In addition, €48 million has been added to the undistributed profit from the revaluation reserve due to depreciation expenses.
Preference dividend reserve
In 2021, Stedin issued cumulative preference shares on which a yield of 3% is required to be distributed or reserved each year. The distribution of this yield is at the discretion of the Board of Management, subject to the approval of the Supervisory Board. If it is not distributed, this yield is taken to a separate reserve.
Statutory reserve
A statutory reserve is included in group equity for the amount of the book value of the internally developed intangible assets.
Cash flow hedge reserve
The cash flow hedge reserve is not freely at the disposal of the shareholders. More information on the movements and the underlying hedging relationships is set out in note Derivative financial instruments and cash flow hedge reserve.
Perpetual subordinated bond loan
On 23 March 2021, Stedin Holding N.V. issued a new perpetual subordinated bond loan (‘Perpetual Fixed Rate Reset Securities’) with a total nominal amount of €500 million at an annual coupon interest of 1.5% and an issue price of 100%. This resulted in net proceeds of €500 million. The bonds are listed on Euronext Amsterdam. On 31 December 2021, the market value was €501 million. The book value at year-end 2021 was €506 million, which is the nominal principal amount including €6 million in accrued interest.
The perpetual subordinated bond loan is regarded as an equity instrument and is subordinated to all of Stedin Group’s creditors but has certain preferences over the shareholders in the event of the company being wound up. Stedin Holding N.V. has no contractual obligation to redeem the loan. Any payment of current or deferred coupon interest is conditional and dependent on distributions to shareholders. Consequently, the bondholders cannot force Stedin Holding N.V. to pay the coupon interest or to redeem all or part of the loan.
The perpetual subordinated bond loan entered into in 2014 was redeemed in full in 2021. The associated costs, which concern a premium as compensation for interest payable of €11 million, are recognised in equity.
