Business
Bank Refinancing & Ricardo Strategic Investment
Bank Refinancing & Ricardo Strategic Investment.
About this update from Science Group Plc
[{"type":"text","content":"\n\n \n\n19 March 2025\n \nScience Group plc\n(\"Group\" or \"Science Group\")\n \nRefinancing of Bank Facilities and Ricardo Strategic Investment\n \nThe Science Group Term Loan (\"2016 Loan\") and Revolving Credit Facility (\"2021 RCF\") were scheduled to expire in September 2026 and December 2026 respectively. In order to support the Group's strategy, the Board initiated negotiations with potential bank debt providers in September 2024 and agreed term sheets with Lloyds Bank in November 2024. These renewed, increased and extended facilities have now been finalised.\n \nTerm Loans\n \nThere are two new Term Loans for a combined value of £12 million, each for 10 years expiring in March 2035. Each loan is secured solely and individually against the Group's freehold properties: one loan to the property in Harston, near Cambridge, and, a second, independent loan to the property in Epsom, Surrey. No other security is provided by the Group operating businesses and there are no operating covenants on these loans.\n \nThe interest margin of 2.6% is the same as the 2016 Loan. Interest rate swaps will fully hedge the two loans resulting in a 10-year fixed effective interest rate of approximately 7.3%, comprising the SONIA lending margin plus the swap rate.\n \nIn connection with repaying the 2016 Loan early, the Group will realise a one-off benefit, with corresponding cash inflow, associated with the interest rate hedging on that loan of approximately £0.6 million.\n \nRevolving Credit Facility (\"RCF\")\n \nThe new, increased RCF is for £30 million, for a period of 5 years expiring in March 2030. The RCF also has a £10 million accordion. If drawn, the RCF has two operating covenants: (1) Net Leverage which should not exceed 3.0x EBITDA; and, (2) Interest Cover which should not be less than 4.0x EBITDA, with certain adjustments permitted to both covenants. The margin on the RCF has been significantly reduced to 1.95%, compared with 3.3% on the 2021 RCF. The RCF is currently undrawn.\n \nStrategic Investment in Ricardo plc\n \nOn 28 February 2025, Science Group announced that it had acquired a shareholding in Ricardo plc, a British science and technology consultancy and engineering business. Through stock market purchases, Science Group is now the second largest shareholder...