1st Apr 2020 16:10
(Alliance News) - K3 Business Technology Group PLC on Wednesday said it has secured a loan of GBP6.0 million from Barclays Bank PLC and two major shareholders.
The software, cloud solution and managed services company said Barclays is extending its existing loan facilities by GBP3.0 million, taking the facility to a maximum of GBP13.0 million.
Additionally, shareholders Kestrel Partners PLC and Non-Executive Director Johan Claesson are providing an loan of GBP3.0 million until June 30, 2021. The loan - which has an 8.0% annual coupon with interest rolling up on a quarterly basis - is unsecured and subordinated to all indebtedness with Barclays.
Kestrel has appointed Oliver Scott to the K3 board as its non-executive director representative.
K3 said it will give other major shareholders the opportunity to participate in further lending of up to GBP2.0 million on the same terms, adding that the cash funding realised from the loans will be used strengthen its liquidity position during the period of disruption caused by Covid-19.
Separately, the Manchester-based company said it will be filing a notice of intention for administration in relation to its UK Dynamics subsidiary, K3 Business Technologies Ltd.
For the 12-month period to the end of November, the subsidiary generated a operating loss of over GBP3.0 million on revenue of GBP21.0 million. K3 said that it expects the business to generate further significant loss in its current financial year amid Covid-19 uncertainty.
The company said it will focus on growing the its core profitable business units and accelerating the transition towards its own intellectual property.
K3 shares were trading 10% lower at 77.00 pence each on Wednesday afternoon in London.
By Ife Taiwo; [email protected]
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