Asset Finance Gives Firm New Lease of Life
Gary Bell is Director and Majority Shareholder of Brand & Rae, a manufacturer of concrete blocks that was formerly part of a larger company that went into receivership. The premises were leasehold, but cash was needed to purchase the extensive plant and equipment that were an integral part of the business.
Gary explains, “We shopped around for lenders but it was very difficult. As a new company with no strong trading history, it wasn’t easy to get support from lenders, especially high street banks. To be fair it would have also been easier if we were looking to purchase new assets as they are much easier to value, whereas all the plant we wanted was second-hand. Even so, we recognised that it was exceptionally good value.”
It took a specialist provider, in this instance Bibby Financial Services, to see the potential of Brand & Rae and they transacted a deal to implement a successful management buy in from the receivers of the old company.
The company has been delighted with the support that Bibby Financial Services has provided and the simplicity of their asset-funding package. “It is a straightforward finance lease facility with fixed rates and terms over a two year period. At the end of our agreement we will continue to use the equipment in exchange for a small monthly fee. We could have opted to pay it off over a longer period thus ensuring we had a sufficient level of working capital each month but we coupled the agreement with a receivables funding facility, which released funds from our unpaid invoices ensuring a smooth and consistent flow of cash into our business in our first critical months. Our experience of asset and receivables finance has been extremely positive and we will definitely consider using it again to grow the company,” says Gary.