Merit Group PLC on Monday said it assigned its lease relating to its office in the Shard building, London, to a third-party to save around £2.3 million over its remaining term.

Shares in Merit were up 21% to 32.00 pence each in London on Monday afternoon.

The London-based data and intelligence firm said its lease for 16,893 square feet on the 11th floor of London’s tallest building ran until July 2026 at an annualised total cost of £2.1 million, giving a total outstanding cashflow liability over the term of the lease of £7.4 million, including dilapidations.

It has agreed to pay a total reverse premium of £2.9 million to assign the lease to an unnamed third-party.

Merit said it estimates it will make a cash saving of around £2.3 million over the remaining term of the lease, after allowing for financing, alternative accommodation, relocation and other costs.

It will fund the costs of the disposal from its existing debt facilities and a new short term loan of £1.8 million, provided by its existing lender Barclays, which will amortise over 18 months. It also expects the disposal and move to alternative accommodation to reduce recognised profit and loss costs by around £1.4 million per year.

‘This agreement will deliver significant cost savings and allow the group to improve its free cash flow,’ said Chief Executive Officer David Beck.

‘This disposal largely completes the first phase of management’s turnaround plan and leaves the group with two strong operating businesses that are profitable, generate cash and benefit from very high levels of recurring or subscription revenue.’

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