DX Group enters sale-and-leaseback deal with ChanceryGate Livingston

Josh White Sharecast | 22 Sep, 2017 15:08 - Updated: 15:08 | | |

cash money sterling pound

DX (Group)

11.25

15:40 17/10/17
-3.23%
-0.38
  • 3,004.39
  • 0.68%20.26
  • Max: 3,005.62
  • Min: 2,978.27
  • Volume: 0
  • MM 200 : n/a
15:50 17/10/17
  • 1,033.57
  • 0.35%3.62
  • Max: 1,034.12
  • Min: 1,028.05
  • Volume: 0
  • MM 200 : n/a
15:50 17/10/17

DX Group announced on Friday that it has exchanged contracts with ChanceryGate Livingston to sell-and-leaseback certain freehold properties for an aggregate cash consideration of £4.5m.

The AIM-traded firm said that at the same time, it entered into an unsecured loan agreement with GCM Partners II, a fund controlled by its major shareholder Gatemore Capital Management, for a loan to the company of £2m.

As it previously announced, DX had been in discussions with Gatemore and its bankers HSBC over financing options for the company's standalone transformation strategy.

The proceeds of the property transaction and the Gatemore loan would be used primarily to repay the company's term loan with HSBC, which was the first step of an “essential comprehensive refinancing” of the company.

DX said it was currently in “close and constructive” discussions with certain key shareholders regarding the broader refinancing.

Its board said that was necessary because it identified a “near term material funding requirement”, over and above the company's existing resources, to address a working capital shortfall caused by DX’s recently-reduced levels of profitability, and to provide funds for the planned investment into improving the financial performance of the DX business.

“We welcome the support of our shareholder, Gatemore, alongside that of our bank, HSBC, as we proceed with our standalone transformation strategy, and will provide a further update on the Company's financing arrangements within coming weeks,” said DX chairman Bob Holt.

Liad Meidar, CIO and managing partner of Gatemore Capital Management, said the Gatemore loan enabled the company to pay down HSBC's term loan, while retaining the freight hub in Willenhall.

“This gives the company greater financial and operational flexibility, setting the stage for the refinancing.

“We expect to roll our loan shortly into the new financing, positioning DX with a healthy balance sheet and a new start under proven leadership.”

More news

15:46 Johnson and Johnson raises full year targets after strong third quarter

Healthcare giant Johnson and Johnson posted higher than expected profits for the three months to 30 September thanks to increased demand for its new cancer drugs and the additional revenue afforded to the group from its June acquisition of Swiss biotech company Actelion.

15:41 AIM newcomer Cora Gold enters drilling agreement with Target

West Africa-focussed gold exploration company Cora Gold announced on Tuesday that its wholly-owned subsidiary Cora Gold Mali has entered into a contract with Target Drilling, to supply aircore, reverse circulation and diamond core drilling, focusing primarily on its flagship Sanankoro Gold Discovery in South Mali.

15:37 CloudCall raises £3.7m through two placings

Cloud-based software business CloudCall announced on Tuesday that it has raised approximately £3.5m before expenses, by way of a placing of 2,457,774 new ordinary shares at 143.5p.

15:32 Stratex offloads stake in Goldstone Resources

Gold exploration and development company Stratex announced the sale of its 13.7% stake in Goldstone Resources to institutional investors on Tuesday, at a price of 1.6p per share, for total cash consideration of £0.55m.

15:30 NAHB housing market index hits five-month high in October

Sentiment among US housebuilders unexpectedly improved in October, according to data released on Tuesday.

15:28 Fuel costs goose US import prices higher in September

Dearer fuel imports boosted the cost of overseas goods last month, albeit alongside similar-sized gains in export prices.

15:28 Flowtech Fluidpower pumps out solid third quarter

Specialist technical fluid power products supplier Flowtech Fluidpower updated the market on its trading following its third quarter to 30 September on Tuesday, reporting that group revenue during the first nine months of the year was up 34.4%.

15:18 FTSE 100 movers: Pearson surges on results but Merlin gets clobbered

London's FTSE 100 was up 0.3% to 7,546.11 in afternoon trade on Tuesday as investors digested the latest UK inflation figures.

15:17 RhythmOne expecting bumper first half amid acquisition spree

RhythmOne updated the market on its expected performance for the half year to 30 September on Tuesday, reporting revenues of between $112m and $114m, up from $67m in the first half of the 2017 financial year, which the company said was driven by “programmatic platform growth”.

15:16 US industrial production misses forecasts in September

Industrial production in the US rose as expected last month but amid downwards revisions to readings for previous months, especially in manufacturing.