REG - Kelso Group Holdings - Update on Investment in NCC Group plc

Kelso groupAnnouncement

Today 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20260122:nRSV8645Pa&default-theme=true

RNS Number : 8645P  Kelso Group Holdings PLC  22 January 2026

22 January 2026

Kelso Group Holdings Plc
("Kelso" or the "Company")

Update on Investment in NCC Group plc

Kelso, the main market listed acquisition vehicle, is pleased to announce an
update on one of its portfolio holdings, NCC Group plc ("NCC"), the UK listed
Cybersecurity and Software Escrow business.

Kelso originally invested into NCC in October 2023, with further investments
made during 2024. NCC remains one of Kelso's largest holdings, with 2.0
million shares held at an average in price of 133.7p. In April 2024, Kelso
highlighted the potential value uplift that could be achieved if NCC
considered separating it's two operating businesses (Cyber Security and
Escode).

NCC announced yesterday afternoon that it agreed the sale of its Escode
business to TDR Capital, subject to the relevant conditions and regulatory
approvals being satisfied. The transaction values Escode at a total enterprise
value of £275.0 million, compared to the market capitalisation of NCC, on the
day prior to the disposal announcement, at approximately £415.0 million. This
disposal follows the announcement of the strategic review in April 2025,
confirming that the Board of NCC was investigating a number of options,
including a potential sale.

Kelso is pleased to see the Board's commitment to return a significant
proportion of the proceeds to shareholders and consult with its shareholders
on the quantum and form of this capital return. In addition, Kelso is also
pleased to see the announcement of a £70.0 million share buyback programme
which is expected to begin imminently.

Following completion of the disposal of Escode, NCC will become the UK's
largest pureplay Cyber Security business. On 16 July 2025, the Board of NCC
also announced a strategic review in relation to its Cyber Security division.
Kelso expects this will result in a sale of the business during 2026. Kelso
believes that the synergies to any industry buyer of the business, if it were
sold, could be very material.

Based on Kelso's internal calculations and the figures referenced above, the
resulting Cyber Security business implies an enterprise value of £140.0
million, equating to an EV/Sales multiple of 0.6x on the revenue contribution
of £238.9 million for the period ended 30 September 2025. This represents a
significant discount to its peers.

Kelso believes that the disposal of Escode is another example of the extent to
which many companies listed on the UK stock market are undervalued.

Aside from Kelso's recent purchase of 400,000 shares in Saga plc as announced
on 6 January 2026, the successful £2.0 million fundraising at 3 pence per
share on 17 December 2025, there have been no other material changes to any
Kelso shareholdings post the interim results update. Kelso continues to hold
six material investments.

Kelso looks forward to updating its shareholder on its other shareholdings
during the course of 2026.

 

 

Sir Nigel Knowles, Chairman, Kelso said:

 

'The management team of NCC have delivered an excellent outcome with the
disposal of the Escode software business. The remaining Cyber Security
operations are well positioned in a highly attractive end market, where
independent testing and assurance of cyber defences is an increasingly
critical priority for any board of directors or senior management.'

 

 

Note to Editors

Kelso Group Holdings Plc 'Kelso' is a listed investment vehicle founded in
November 2022 which is backed now by over 65 individuals known to the Board
and more recently a small number of institutions. The Board own close to 20%
of Kelso and between them have approaching 150 years of experience in UK
listed companies through a mixture of fund management, corporate broking,
M&A, private equity and law.  Kelso's aim, which is unique, is to
capitalise on an undervalued UK small and mid-cap stock market by investing in
a small number of stocks being less than ten core investments. Kelso's aim is
to actively help its investee companies by offering constructive advice,
support and ideas predominantly around investor relations and strategy in
order to unlock trapped value.  Kelso's current principal holdings are Saga
plc, NCC Group plc, THG plc, Angling Direct plc, The Works.co.uk Plc and
Selkirk plc. Kelso expects to announce other new investments during 2026.

 

 

 

For further information, please contact:

 

 Kelso Group Holdings plc                 +44 (0) 75 4033 3933
 John Goold, Chief Executive Officer

 Jamie Brooke, Chief Investment Officer
 Zeus (Broker)                            +44 (0) 20 3829 5000
 Louisa Waddell, John Moran (Investment Banking)

Ben Robertson (Corporate Broking)
 Camarco (Financial PR)
 Billy Clegg, Tom Huddart                 +44 (0) 20 3757 4980

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  STRFZGZMMMLGVZZ



            Copyright 2019 Regulatory News Service, all rights reserved