Swedish furniture manufacturer Nobia has announced its new factory in Jonkoping, Sweden, which will see the company’s largest ever investment of SEK 3.5billion, will be fully operational by 2024.

The company will invest SEK 2billion in machinery and a further SEK1.5billion in the factory building, which is expected to be sold and leased back when it is in full operation.

Nobia has secured long-term debt financing through two new credit facilities, from Svenska Handelsbanken AB (publ) and Nordea Bank Abp, filial i Sverige, totalling SEK 5 billion.

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It includes a SEK 2 billion facility with a term of three years (with the option to request an extension of up to two years at the lenders’ sole discretion) and a SEK 3 billion facility with a term of five years.

These will replace, extend and increase the current facility Nobia has with the same two banks.

President and CEO of Nobia Jon Sintorn stated: “I am pleased that we have secured the financing of our strategic plan. This, together with the conclusion of the trade union negotiations and the transition program communicated yesterday, complete the initial preparatory phase and we are now looking forward to executing on our exiting strategic initiatives.”

The Jonkoping factory will replace Nobia’s existing production plant in Tidaholm.

The company will subsequently write-down the assets of SEK 149 million in machinery and buildings relating to the Tidaholm factory, which will be charged to operating income for the fourth quarter 2020.

Furthermore, Nobia will incur other associated costs of approximately SEK 130 million to be recorded in 2023/2024.