Member Article

Cloud company agrees £4million refinancing package

Manchester based cloud computing firm Outsourcery has secured a £4million refinancing deal with telecoms giant Vodafone.

Outsourcery offers cloud-based IT and unified communications solutions for the commercial and public sectors.

In agreeing to provide the facility, Vodafone will now take a stake in the firm, who will pay the loan back over 48 months, ending in June 2019. Interest will be charged monthly at a rate of 7.5% a year, with repayments spread over 12 quarterly periods from year 2 onwards.

As part of the agreement, Vodafone will be granted a warrant over three million new ordinary shares at 30p per share.

Jeni Mundy, director, product management, Vodafone Group Enterprise , 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.”

The agreement replaces Outsourcery’s existing £1.4million loan facility which had been due to expire on April 1 2017, and a £0.3million mortgage facility provided by Barclays Bank. The remaining £2.3million of the loan can be used as general working capital.

The company has also amended the terms of an existing £1 million loan with Etive Capital. Rather than ending on 22nd May 2016, this will now run to 31st December 2017. Currently interest-free, the loan will, from May 2016, attract 10% per annum.

Outsourcery’s co-chief executive, 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.”

This was posted in Bdaily's Members' News section by Simon Malia .