Zentra Group plc: Transition to Aquis and Strategic Update

11 December 2024

ZENTRA GROUP PLC

(“Zentra”, “the Company” or “the Group” or “ZNT”)

Zentra Group plc: Transition to Aquis and Strategic Update

Zentra Group PLC (the “Company” or “Zentra”), the UK-based residential developer and development manager, is pleased to provide an update on in its transition to the Aquis Stock Exchange and its restructure.

Transition to Aquis Stock Exchange
As part of the Company's ongoing evolution, Zentra is pleased to have transitioned from the Main Market of the London Stock Exchange ("LSE") to the Access Segment of the Aquis Stock Exchange Growth Market ("AQSE"). This transition reflects the Company's size and objectives, aligning more closely with AQSE’s growth-focused market. The Board believes that AQSE offers a more suitable platform to support Zentra's ambitions and that it will help position the Company for future growth.

The move is expected to unlock increased visibility and access to a more suitable investor base, supporting Zentra's commitment to sustainable growth and long-term value creation. The transition will enable the Company to operate within a market that better reflects its current stage, positioning it for further success in its core residential sectors.

Strategic Realignment and Restructuring
The past year has been transformative for Zentra as the Company has implemented a significant restructuring plan to streamline operations and better position itself within the UK residential development market. This transformation includes the discontinuation of its co-living and in-house construction businesses, in favour of a single focus on delivering high-quality residential apartments and houses.
The key aspects of this restructuring are as follows:

1. Operational Focus on Core Residential Sectors
   Zentra has honed its business strategy to two key areas of residential development:

• Zentra Living – delivering modern, vibrant residential apartments aimed at professional urban dwellers.
• Zentra Homes – providing family houses tailored to individuals seeking traditional housing options.

This dual-brand strategy enables the Company to target a broader spectrum of the residential market, creating distinct offerings for both professionals and families. By moving away from co-living services, which have been adversely affected by market challenges, and transitioning to more traditional residential offerings, the Company aims to capture growth opportunities in the mainstream housing market, which remains resilient despite broader economic uncertainty.

2. Restructuring of Debt and Capital Allocation
   As part of the strategic realignment, Zentra has undertaken a significant restructure of its debt and capital allocation. Alongside this, the Company has recently completed both a major acquisition and sale:

• Acquisition of One Victoria, Manchester: The Company recently announced the acquisition of a 30% stake in the One Victoria project in Manchester for £3 million. One Victoria, a high-quality residential and commercial development, is a key addition to the Company’s portfolio. The project, which consists of 129 apartments and 2 commercial units, is scheduled for completion in 2025. Zentra will also continue to act as Development Manager for the project.
• Sale of Completed Properties: Zentra also recently announced the sale of a £7 million portfolio of completed residential and commercial properties. This sale includes properties in key assets such as Bank Street in Sheffield and Lincoln House in Bolton, providing valuable capital to reduce the Company’s debt and strengthen its balance sheet.

In July 2024, Zentra completed the sale of Seaton House, Stockport, for £600,000. Additionally, the Company has exchanged conditional contracts for the sale of the land to the rear of Seaton House, an existing car park, for a price of £400,000. Completion of this sale is subject to the buyer obtaining planning approval which is expected in Q1 2025.

Zentra continues to hold a development management contract on One Heritage Tower, Salford (with planning permission for 542 residential apartments and 2 commercial units). Any sale secured will generate for the Company a 3% fee of the gross proceeds.

The Company also owns land in Churchgate in Leicester, and as previously announced, it will be securing a sale in due course. This process has been delayed due to a rights of light dispute, with a sale now expected in Q1 2025.

3. Service Agreement with OH UK Holdings
   In addition to the changes outlined above, the Company is also pleased to announce the signing of a new service agreement with OH UK Holdings, a related party due to it having the same beneficial owners as Zentra. Under this agreement, Zentra will provide management and sales services to OH UK Holdings, in respect of their property portfolio.
    

The key terms of the agreement are:

• A management fee of £50,000 per annum, 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.

Jason Upton, CEO of Zentra Group, commented:
“We are excited to announce the next chapter for Zentra as we transition to AQSE and align our business for the future. Our renewed focus on residential development, combined with our recent acquisitions and restructuring, positions us well for sustainable growth. We are confident in our ability to help meet the housing needs of communities across the North of England and look forward to expanding our development pipeline in the years ahead. Our strategic partnerships, including the new service agreement with OH UK Holdings, reinforce our commitment to value creation for all stakeholders. We are confident that our new direction will deliver long-term value for shareholders and contribute positively to the housing shortage in the UK.”

Further updates will be provided in due course.

Contacts

Zentra Group plc

Jason Upton

Chief Executive Officer

Email: jason.upton@zentragroup.co.uk

Robert Holbrook

Head of Finance

Email: robert.holbrook@zentragroup.co.uk

Hybridan LLP (Financial Adviser and Broker)

Claire Louise Noyce

Email : claire.noyce@hybridan.com

Tel: +44 (0)203 764 2341

About Zentra Group plc

Zentra Group is a property development and management Company. It focuses on the residential sector primarily in the North of England, seeking out value and maximising opportunities for investors. The Company is currently listed on the Access Segment of the Aquis Stock Exchange Growth Market, trading under the ticker ZNT.

For further information, please visit the Company’s website at www.zentragroup.co.uk The previous website www.oneheritageplc.com will automatically redirect to the new website.