Christmas Newsletter
No doubt you’re all very busy, ensuring everything is in place for your clients in the final week of Christmas. It’s been another great year for the team at Affinity, having successfully supported over 200 clients with funding requirements. Confidence in the market appears high, as business owners continue to make significant investment decisions.
The list of assets we’ve financed is as diverse as ever, covering the full spectrum, with a swift and efficient service as always. No matter what the request, we will always try and find a funding solution and some deals have certainly challenged us!
Business acquisition has also been on the rise this year, we’ve completed over a dozen significant re-finance cases, utilising the equity in equipment to help finance MBO’s/MBI’s. It is a simple and cost effective way of ‘sweating the assets’ of a target business, using only the equipment as security.
As we head into 2018, it will unbelievably be our 8th year! The time has certainly flown and market conditions have ebbed and flowed in that time. However, there is a very positive outlook ahead and we look forward to offering continued support to our clients.
REMEMBER! For those of you with 31st December year end’s, next week is your last chance to get proposals into us, ensuring payment is made to suppliers in time. Make any capital purchases now, small or large to ensure you don’t waste your Annual Investment Allowance.
Deal Summary
Nottinghamshire based haulage business expands fleet through acquisition of 10 trailers…
We have known this client for over 5 years, having successfully secured finance for their first ever HGV, when the business was incorporated. Now, they have contracts with several large blue chip organisations and numerous local clients.
Historically, they have hired all their trailers due to varied work loads and not wanting to put the business under too much financial pressure. However, now an established company with guaranteed contacts they were able to purchase 10 trailers at a cost of £100K. We spread the payments over 5 years and included a 3 month VAT deferral, to help assist with cashflow. This has enabled them to de-hire all existing trailers providing a significant cost saving. The rental costs were c.50% more than the monthly repayments through Hire Purchase. The business will now benefit from owning the assets and reduced rental costs.
Refinance of plant and machinery to assist with business purchase…
Having been introduced to this client by a trusted adviser we were quick to meet the proposed business owner and discuss how we could assist. We met with the client and it became apparent that for almost 6 months their own Bank had been ‘deliberating’ over how or if they could assist. The business was for sale and a previous employee wished to purchase the business, including all the assets.
The proposal in our view was straightforward and with many years’ experience we were confident we could complete the funding requirement quickly. The target figure to be raised against plant and machinery was £250k which would be a contribution towards the overall sale price and this refinance was pivotal to the overall success of the business purchase.
We arranged a valuation of the equipment, structured a credit backed finance facility and in less than a week the documents were raised and with the client for signing. The deal completed successfully with the new owner at the helm planning future growth and success.
Midlands based metal fabrication company invests in further growth…
Our client for many years, supplies metal fabrication services to customers throughout the world. They had spent 2017 implementing a strategy for replacing older machinery and adding additional machinery to expand their capability and remove the need for any outsourcing. The factory had recently been ‘streamlined’ with efficiency in mind, the latest machine addition had been ordered and we were asked to put the funding in place. With a total purchase price of £330k we used one of our most competitive funders and structured a facility which offered an excellent term, to keep payments low, and deposits in line with the client’s requirements.
The funding was secured in less than a day and completed in time for Christmas.
Vehicle Hire business plans for further growth in 2018…
An existing client we have worked with for a number of years discussed their plans for 2018 and they were looking for significant growth and fleet expansion. Although not an immediate finance requirement, they did need the comfort that this growth could be funded and asked us to identify appetite with our funders. We now have over £250K secured through a variety of lenders, which will be drawn-down throughout 2018.
Lastly, a sincere thank you to all our clients and introducers for your business and support this year. We both hope you have a fantastic Christmas with your families and enjoy the New Year celebrations!