Deal Type: Working Capital
Loan Amount: £75k
Loan Type: Fast Track
Security: Personal Guarantees and Company Debenture
Region: Yorkshire
When a manufacturing company that sells into the hospitality trade required working capital to ease short term cash flow challenges, Reparo Finance completed the deal within 48 hours.
The borrower had a large R&D tax claim pending and needed cash to maintain operations while HMRC processed the claim.
The borrower was struggling to raise capital from traditional lenders for several reasons:
- The business was in the growth phase, so revenue wasn’t consistent throughout the year.
- Capital was needed quickly, making it unlikely a bank would be able to complete the deal in time.
- Although trading for five years, the business was relatively young in its lifecycle.
- There were limited assets inside the business to use as security.
While completing a deal with a traditional lender seemed unlikely and at the very least time-consuming, Reparo was able to provide funding.
Every deal Reparo look at is reviewed by an experienced commercial lender, so instead of a rigid set of criteria being applied, every application is considered on its merits.
The team were able to complete the deal for a few key reasons:
- The management team were experienced in the sector and delivering a clear business vision.
- The business owned intellectual property that had some value and indicated the business has a positive future.
- All three directors were willing to provide personal guarantees.
- Management were willing to place a debenture over the company.
- The business had growing revenue and solid profit margins.
- The R&D tax credit application was highly likely to be accepted.
Reparo relationship manager Jason Cossey said: “We were delighted to provide lending to this business. The value proposition is strong, the management are experienced, and the business is doing well. The business is in the growth phase, and lacking tangible security, so the deal required a closer look. The team here were able to quickly understand the financials and make a decision in 24 hours – from start to finish the deal was completed in a couple of days.”
Reparo managing director Andrew Ward added: “With a deal like this we take a look at the business and the people behind it. Not only were the management accounts showing growth and a business tending in the right direction, but the leadership team were experienced. In the end, we were delighted to help this relatively young company access the working capital it needed.” To discuss a loan of between £10,000 and £1m, please get in touch with one of the team on either sales@reparofinance.co.uk or 0161 451 5710. You can find out more about us on our website: www.reparofinance.co.uk.