Swedish real estate group SBB said the lender dropped the suit.

STOCKHOLM (Reuters) – Sweden’s SBB said on Monday that one of its creditors, U.S. hedge fund Fir Tree Partners, would end pending legal action against the real estate group, sending its share price soaring.

Fir Tree has demanded immediate debt repayment from SBB, citing breach of bond clause from 2023.

SBB’s share price was up 5.8 percent at 1210 GMT on Monday.

Fir Tree did not immediately respond to a request for comment.

SBB, built on the purchase of public assets including social housing, government offices, schools and hospitals, stands at the center of Sweden’s real estate bubble, which is set to burst from 2022 to 2023 due to rising inflation and interest rates.

Fir Tree earlier this month, through its two funds, dropped two other claims, SBB said.

Fir Tree’s entities at one point held 46 million euros in notes for the process, although 7.5 million euros ($7.67 million) remained on the final charge, according to SBB.

“Now we can put this behind us and devote all our time to business and preparing for SBB,” the company’s CEO Levi Sines told Reuters.

SBB last month received approval from several creditors to restructure major parts of its bonds, which would make it easier for the group to divest assets and reduce its total debt, management said at the time.

Fir Tree’s decision removes some of the short-term liquidity problems for SBB, Carlsvar analyst Bertil Nilsson said.

“That said, SBB still has short-term debt due to renew in 2025, which is significantly higher than its current cash, which clearly needs to be resolved before it can fully exit,” Nilsson said.

($1 = 0.9775 EUR)

(Reporting by Marie Manns, Greta Rosen Fondahn; Writing by Louise Bresch Rasmussen; Editing by Stin Jacobson, Tere Solsvik and Sharon Singleton)