Completion of Sale of Redcentric Data Centres Ltd
Summary by AI BETAClose X
The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the 'UK MAR') which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
1 May 2026
Redcentric plc
('Redcentric', the 'Company' or the 'Group')
Completion of Sale of Redcentric Data Centres Limited
'Transaction unlocks significant shareholder value'
Redcentric plc (AIM: RCN), a leading UK IT managed services provider, is pleased to announce the successful completion of the sale of its entire data centre business, Redcentric Data Centres Limited, to Stellanor Datacenters Group Limited for an estimated £122.85 million1 (the 'Transaction').
The Transaction, originally announced on 23 October 2025, has completed following the satisfaction of all conditions precedent. This marks a pivotal milestone for the Group, enabling a substantial return of capital to shareholders, significant debt reduction, and a sharpened strategic focus on growth opportunities within the remaining Managed Services Provider ('MSP') business.
An initial payment of £115.4 million was received by the Company on 30 April 2026 in accordance with the terms of the agreement. The remaining consideration is expected to be received by 31 July 2026, once the post completion adjustments have been concluded.
Use of Proceeds
The Board has prioritised the use of proceeds to deliver a substantial near-term return of capital to shareholders while strengthening the Group's balance sheet and supporting the core established successful MSP business.
In summary:
· Material Return of Capital Return to Shareholders: The Board intends to propose an equity tender offer at a price of 160 pence per share. The Tender Offer is expected to return in excess of £90 million2 to shareholders and will be subject to shareholder approval.
A Circular containing full details of the Tender Offer, confirming the proposed price per share, amount payable and timetable, is expected to be published in June 2026, with settlement anticipated in July 20263.
· Potential Share Buy Backs4: In addition to the equity Tender Offer, the Company may, subject to market conditions, make on-market purchases of its own ordinary shares. Any purchases will only be made where the Board believes they represent an attractive use of capital and are in the best interests of shareholders.
· Debt Reduction5: The Group will reduce its Revolving Credit Facility ('RCF') from £60 million to £30 million and repay a significant portion of the drawn facility, lowering it from £40 million to approximately £19 million. The Board is committed to retaining a strong balance sheet with modest net borrowing, which it sees as a positive differentiator compared to its peers.
Background and Board Rationale
This Transaction is the successful outcome of the Board's prior decision to separate the Group's two distinct business units. This process has crystallised an attractive valuation for the data centre assets and enables the Group to dedicate its focus on the core established successful MSP business.
Support for MSP Growth Strategy
The Board has assessed the capital requirements of the continuing MSP business and believes that the capital available to the Group, combined with the Company's profitable outlook and cash generation profile, will be sufficient to drive organic growth.
Richard McGuire, Non-Executive Chairman of Redcentric, said: "I am delighted to thank the teams at both Redcentric and Stellanor for their outstanding efforts and professionalism, which have enabled the successful completion of this complex transaction.
"This transaction crystallises significant value for Redcentric shareholders and allows us to return the majority of the proceeds directly to them through a substantial capital return. At the same time, the transaction further strengthens the Group's balance sheet by significantly reducing debt, enabling Michelle and the management team to focus exclusively on Redcentric's successful core Managed Services business."
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Enquiries:
|
Redcentric plc Michelle Senecal De Fonseca, CEO Tony Ratcliffe, CFO |
via Burson Buchanan |
|
Cavendish Capital Markets Limited - Nomad and Broker Marc Milmo / Callum Davidson (Corporate Finance) Andrew Burdis / Sunila de Silva (ECM) |
Tel: +44 (0) 20 7220 0500 |
For media enquiries:
|
Burson Buchanan - Financial Communications Henry Harrison-Topham / Jamie Hooper |
Tel: +44 (0) 20 7466 5000 |
Notes to Editors:
Redcentric has a strong track record in delivering IT managed services provision that empowers businesses to scale, innovate and grow in a rapidly evolving digital landscape. As technology continues to advance the Company's goal is to be the go-to-all-in-one infrastructure and managed IT service provider for customers of all sizes offering an unmatched range of products and solutions.
The Company's MSP division serves the private and public sectors with all their IT requirements. The MSP division acts as an outsourced IT department, handling day to day maintenance and security of customers' IT infrastructures. This allows customers to improve security and efficiency and focus on growing their core businesses.
From infrastructure management and cloud services to cybersecurity and data analytics, Redcentric has a comprehensive suite of solutions designed to meet the diverse needs of modern businesses.
For additional information please visit www.redcentricplc.com
Notes
1 The Company estimates the completion settlement will be £122.85 million. This comprises an expected £83.74 million for shares plus £39.11 million settlement of an intercompany debt. The forecast Enterprise Value being £122.3 million, plus forecast post completion reconciliations of £0.57 million. The final proceeds will be subject to usual post completion confirmation adjustments. An initial settlement of £115.4 million was received on 30 April 2026 in accordance with the terms of the agreement.
2 Under the sale agreement, Stellanor Datacenters Group Limited has retained approximately £7.45 million pending post-completion adjustments. Stellanor has already paid initial proceeds of £115.4 million. After allowing for the planned repayment of approximately £21 million of debt and estimated transaction costs of £5 million, this delivers a net initial cash inflow to the Company of circa £90 million. While the Company expects the final adjustments to result in the release of the full £7.45 million retained amount, the Board has adopted a prudent approach and is currently indicating a return of capital of £90 million.
3 The proposed equity tender offer will provide shareholders with a material liquidity opportunity at a price the Board believes is more reflective of the Company's intrinsic value. Full details will be set out in the formal tender offer document and will be conditional upon the satisfactory completion of the Capital Reduction process, announced 24 April 2026.
4 The Company holds shareholder authority (granted at the 2025 AGM) to purchase up to 7,952,181 ordinary shares. Passed Resolution 15 from the 2025 AGM The Company be and is generally and unconditionally authorised pursuant to section 701 of the Companies Act 2006 (the 'Act') to make market purchases (within the meaning of section 693 of the Act) of ordinary shares of £0.001 each, provided that:
a. the maximum aggregate number of ordinary shares that may be purchased under this authority is 7,952,181;
b. the minimum price (excluding expenses) which may be paid for each ordinary share is its nominal value;
c. the maximum price (excluding expenses) which may be paid for each ordinary share is the higher of:
i. 105 per cent of the average market value of an ordinary share in the Company for the five business days prior to the day the purchase is made; and
ii. the value of an ordinary share calculated on the basis of the higher of the price quoted for: the last independent trade of an ordinary share; and the highest current independent bid for an ordinary share, at the time on the trading venue where the purchase is carried out.
5 Debt Position: Pending the distribution, the Board plans to repay the entire £40 million of currently drawn RCF in order to reduce financing costs. In addition, the Company has arranged term deposits to generate further income until required for shareholder distribution. By 30 June 2026 the Group expects to have agreed revised RCF facilities of £30 million.
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