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Highlights
- Zentra successfully transitions from LSE to AQSE, aligning with its growth-focused objectives.
- The Company redefines its business strategy, focusing on high-quality residential apartments and houses.
- Zentra enhances its balance sheet through strategic acquisitions and property sales, reducing debt.
Zentra Group PLC (the “Company” or “Zentra”), a UK-based residential developer and development manager, is pleased to announce significant updates regarding its transition to the Aquis Stock Exchange (AQSE) and its ongoing strategic restructure.
Transition to Aquis Stock Exchange
As part of its evolution, Zentra has moved from the Main Market of the London Stock Exchange (LSE) to the Access Segment of AQSE’s Growth Market. This transition aligns with the Company's current size and long-term goals, offering a more suitable platform to support its ambitions. AQSE’s growth-focused market is expected to unlock increased visibility and broaden access to a more aligned investor base, providing the Company with greater opportunities for sustainable growth.
The move is part of Zentra’s strategy to better reflect its stage of development and to operate in a market that is more supportive of its current objectives. The transition to AQSE is also expected to enhance the Company’s ability to achieve long-term value creation, particularly in its core residential sectors.
Strategic Realignment and Restructuring
In a transformative year, Zentra has implemented a major restructuring plan, aimed at streamlining operations and refocusing its business model on residential development. The Company has discontinued its co-living and in-house construction operations and is now entirely focused on delivering high-quality residential apartments and houses. This new strategic direction is underpinned by the following initiatives:
- Operational Focus on Core Residential Sectors: Zentra’s refined strategy targets two key residential sectors:
- Zentra Living: Focused on delivering modern, vibrant residential apartments for professional urban dwellers.
- Zentra Homes: Offering family homes tailored to individuals seeking traditional housing options.
This dual-brand approach enables Zentra to cater to a broad residential market, including both professionals and families. The decision to move away from co-living services, which have been impacted by market challenges, allows the Company to capture growth in the mainstream housing market, which remains resilient despite broader economic uncertainty.
- Restructuring of Debt and Capital Allocation: As part of its strategic realignment, Zentra has also undertaken a significant restructure of its debt and capital allocation. Notable steps include:
- Acquisition of One Victoria, Manchester: Zentra has acquired a 30% stake in the One Victoria project for £3 million. This high-quality residential and commercial development consists of 129 apartments and 2 commercial units, with completion scheduled for 2025. Zentra will continue to act as the Development Manager for the project.
- Sale of Completed Properties: Zentra has sold a £7 million portfolio of completed residential and commercial properties, including key assets in Bank Street, Sheffield, and Lincoln House, Bolton. These sales have provided valuable capital to reduce debt and strengthen the Company’s balance sheet. Additionally, Zentra has completed the sale of Seaton House, Stockport, for £600,000 and has entered into contracts for the sale of a car park adjacent to Seaton House for £400,000.
The Company continues to hold a development management contract for One Heritage Tower, Salford, a project with planning permission for 542 residential apartments and 2 commercial units. Zentra will receive a 3% fee of the gross sale proceeds from any sale of the project.
Zentra also owns land in Churchgate, Leicester, and expects a sale in Q1 2025, although this process has been delayed due to a rights of light dispute.
- Service Agreement with OH UK Holdings: Zentra has signed a service agreement with OH UK Holdings, a related party. Under this agreement, Zentra will provide management and sales services for OH UK Holdings’ property portfolio. The key terms include:
- An annual management fee of £50,000 or 1.75% of the gross asset value, whichever is higher.
- A transaction fee of 2% of the gross sale price for each property disposed of.
