Safestyle to raise £8.5m to safeguard trading

​The Bradford-based firm​ said the cash will strengthen ​its balance sheet so that the business is well capitalised and has a strong cash buffer to ensure it can continue ​trading.

A proposed conditional placing​ ​to raise £8.5​m at a price of 17​p per share with institutional and other investors (including all of the ​d​irectors), ​will be launched this evening.

The ​firm​’s banking covenants will be waived for up to ​six​ months following completion of the ​p​lacing, to apply for the entire shutdown period​,​ and a reduced EBITDA covenant target will be in place for the rest of the year following resumption of trading.

​Two weeks ago, the group said it was temporarily closing all of its locations across the country following the coronavirus outbreak.

The​ ​firm said that in light of the current situation and recent Government guidance, it ​has also temporarily ceased all installation activities.

The group said the decision has been made in the interests of all its key stakeholders, in particular its colleagues, customers, shareholders and the nation as a whole. Some firms have been criticised for forcing employees to work despite the Government’s attempts to limit the outbreak.

Safestyle warned the decision to temporarily halt normal activity could have a material impact on the group’s trading this year.