CloudCoCo Group PLC announced on Wednesday that its subsidiary, CloudCoCo Holdings Ltd, has struck a deal to sell the entire share capital of its IT managed services business, CloudCoCo Ltd. Shares in the London-based provider of managed IT services and communications solutions surged more than threefold to 0.44 pence each in London on Wednesday afternoon.
The proposed sale to Gateshead, England-based IT managed service and cybersecurity provider Aspire Technology Solutions Ltd is set to fetch a gross cash consideration of up to GBP9.2 million, resulting in a net cash consideration of around GBP7.9 million. The proceeds from the sale will cover all of the group’s liabilities, including existing loan notes with MXC Guernsey Ltd, with approximately GBP950,000 in cash left for working capital.
The sale is contingent upon shareholder approval at the company’s general meeting on October 31. Chair Simon Duckworth expressed optimism about the sale, stating that it marks a positive step for the group by allowing them to eliminate long-term debt and focus on expanding their value-added reseller operation, particularly in e-commerce. He also mentioned that discussions are underway for the sale of their connect business to further bolster their financial position and streamline their proposition.
CloudCoCo anticipates reporting full-year revenue for 2024 of at least GBP27 million, a 4.2% increase from last year’s GBP25.9 million. The company is confident that the strategic shift announced will secure its long-term future and provide a solid foundation for growth moving forward.
By Emily Parsons, Alliance News reporter
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