Outsourcery conjures up £4m refinancing
CLOUD computing firm Outsourcery has agreed a significant refinancing deal with telecoms giant Vodafone.
As part of the terms of the £4m debt facility the FTSE 100 giant will take a stake in the loss-making Manchester company.
Under the terms of the agreement AIM-listed Outsourcery, which offers cloud-based IT and unified communications solutions for the commercial and public sectors, will pay the loan back over 48 months, ending in June 2019, with interest charged monthly at a rate of 7.5% a year.
As part of the facility, Vodafone will be granted a warrant over three million new ordinary shares at 30p per share.
The new term loan replaces Outsourcery’s existing £1.4m loan facility due to expire on April 1 2017, and a £0.3m mortgage facility provided by Barclays Bank. The remaining £2.3m of the new facility can be used for general working capital purposes.
As a result of these new debt facilities, Outsourcery will benefit from a reduced weighted average cost of capital, additional working capital and further alignment with strategic partner Vodafone.
Co-chief executive of Outsourcery Piers Linney said: “Vodafone Group is a key strategic partner for Outsourcery and we are pleased to be deepening our relationship.
“Together with our extended loan from Etive, we will benefit from a reduced cost of capital, and have greater flexibility to pursue our growing pipeline of opportunities with enterprise customers and the public sector.”
Director, product management, Vodafone Group Enterprise, Jeni Mundy, said: “We are pleased to partner with innovative communications technologies, and see this loan agreement as an example of how large organisations can support SMEs achieve their growth ambitions.
“Our strategic partnership with Outsourcery is key to our unified communications and collaboration strategy and we look forward to addressing this large market opportunity together with Outsourcery.”
