Redcentric plc, a UK-based managed service provider, has agreed to sell its dedicated data centre business to Stellanor Datacenters Group, with the deal said to be worth up to £127 million. 

Redcentric Data Centres Limited operates eight data centres across the UK, with six located in the crucial London and South East area, with an additional two located in Cambridge and West Yorkshire, respectively. Those will now be added to Stellanor’s portfolio, which includes the two London-based data centres that it acquired from Colt Technology Services last month. 

Speaking of the deal, which is expected to be completed by May 2026, Redcentric Chief Executive Michelle Senecal De Fonseca, noted, “We are pleased to announce the disposal of RDC to Stellanor which is a positive outcome for Redcentric and our shareholders. 

The completion of the DC sale will allow management to focus squarely on the MSP business which has a very strong brand and market position in both the public and private sectors. I am excited at the prospect of driving revenue and margin expansion in the years ahead, which I am confident we will deliver strong returns and shareholder value.”

Redcentric plans to use the proceeds from the sale in three ways: 

• Reducing Group debt – Redcentric currently has a revolving credit facility of up to £60 million, of which £41 million is drawn. The Board expects to materially reduce both the facility ceiling and the amount drawn after completion.
• Returning capital to shareholders, most likely via a tender offer, subject to shareholder approval.
• Retaining sufficient capital to assess growth opportunities within the continuing managed services provider (MSP) operations.

Given its data centre business was no longer key to its core operations, it made sense for the company to sell it to Stellanor, which is exploring aggressive growth in the sector. The firm is backed by German asset management company DWS Group, which also runs NorthC, the company that acquired the other data centres from Colt Technology Services. 

Aparna Narain, Partner at DWS Group – Infrastructure Investments, commented, “The acquisition of RDC by Stellanor represents a transformative step in expanding our UK footprint with high-quality, strategically located assets. 

“With 23MW of secured grid capacity and a blue-chip customer base, RDC’s well-invested facilities and proven operational excellence align seamlessly with our vision to deliver scalable, secure data centre solutions amid rising demand for edge computing in the UK. 

“We look forward to integrating these operations into Stellanor to drive innovation and superior service for our combined clients.”

Until the deal is closed, Redcentric plans to continue running RDC as a carved-out operation while finalising separation, regulatory, financing and property processes.