Redcentric pays £12m for IT firm – which was sold for £9m in February

IT SERVICE provider Redcentric has bought Calyx Managed Services for £12m, just weeks after Calyx was sold for £9m.

Manchester-based Calyx, which employs about 200 people, was sold by venture capitalist Jon Moulton’s company Better Capital in February to MXC Capital.

MXC has today announced it has sold it to Harrogate-based Redcentric, for £12m, payable in cash when the deal completes, which is expected to be in the next fortnight.

AIM-listed Redcentric said the latest deal follows a “period of significant restructuring”, which included the disposals of Calyx’s Break Fix and Carrier Services divisions.

It added: “Calyx is now a focused IT managed services and professional and infrastructure services business, free of liabilities arising from the restructuring process.”

The deal is considered to be a related party transaction under AIM rules because Redcentric’s chief executive Tony Weaver is a “substantial shareholder” in MXC Holdings, which owns 53% of MXC Capital. Redcentric is also paying £300,000 to MXC for corporate advice.

Fraser Fisher, chief operating officer of Redcentric, said: “This acquisition builds on our successful and growing Redcentric platform; following the integration of Calyx we will seek to augment our strong organic growth with further acquisitions that fit our investment criteria.”

It is expected to be earnings enhancing immediately, and allow for cross-selling opportunities.

The acquisition will in part be funded by new bank facilities which Redcentric has put in place, replacing its existing arrangements. It has agreed a a five-year £40m revolving credit facility, with a £20m accordion, along with a £5m asset financing facility and a £5m overdraft facility.

The company said the new facilities will provide “significant levels of headroom” after the acquisition completes.