(Recasts with company confirmation of sale process)

By Amy-Jo Crowley

LONDON, May 24 (Reuters) - British IT services group

Redcentric is in the early stages of talks over a sale

of the company to Milan-listed Wiit SpA, it said on

Friday.

The news followed a Reuters report that it was working with

investment bank Lazard ( LAZ ) on an attempt to sell the company. Under

takeover rules the bidder has now until June 21 to make a firm

offer for Redcentric.

Italy's Wiit describes itself as a leading cloud and

cybersecurity service provider. It has a market capitalisation

of 485.7 million euros ($526.89 million).

Shares in Redcentric, whose clients include broadcaster

Channel 4, Heathrow Airport and the National Health Service,

were up 12.8% following the news in late trading. The company

was valued at 214 million pounds at the close on May 23.

Redcentric's shares are up around 5.5% year to date before

the news, and have largely traded in line with the broader

London market for the past two years, according to LSEG

data.

The company reported a jump in revenue to 141.7 million

pounds last year from 93.3 million pounds a year earlier, partly

driven by acquisitions including 4D Data Centres, Sungard

Consultancy and Sungard Data Centres, according to its latest

preliminary results.

Adjusted earnings before interest, tax, depreciation and

amortisation (EBITDA) increased by 3% to 24.5 million pounds.

This is not the first time Redcentric has explored a formal

sale process. It announced a sale process led by Stifel

Financial Corp ( SF ) in 2020, although discussions with buyers did not

materialise into any formal offers.

Speculation of a sale come amid increasing M&A activity in

the IT services sector. Daisy Corporate Services earlier this

month combined with Wavenet to create a 500 million pound

company in terms of revenue. Private equity firm Hg last month

made an investment in UK IT services provider Focus Group,

valuing the business at $1 billion.

Redcentric provides public and private organisations with

managed IT services including cybersecurity, communication and

cloud computing. It was founded in 1997 and listed on the AIM

market in 2013.

($1 = 0.7860 pounds)

($1 = 0.9214 euros)