Industry: Distribution
Product: IDeal™ with Growth Guarantee Scheme term loan and top up
Facility size: £750k
The client
After initially specialising in the supply of vending machines, they expanded operations to include all coffee shop essentials, from syrups and sugar sachets to teas and other hot drinks.
This expansion included a strategic move to ‘white labelling’ products, which involves selling unbranded goods to give their clients, usually wholesalers, creative freedom to apply their own identity.
The company has used invoice finance to support their continued growth and to successfully navigate two previous changes of ownership.
The challenge
The current director has retired and arranged a management buy-in (MBI) with an external advisor who has been closely involved with the business for the past three years.
Funding was required to complete the acquisition and to ensure there was sufficient working capital to manage any unexpected cash flow issues.
Although the firm has been using invoice finance with an alternative provider, manual reconciliation was making the process difficult to manage, which was distracting from a smooth transition of ownership.
The solution
Recognising the need to simplify the invoice financing, the Close Brothers Invoice Finance team recommended using their IDeal system because it integrates smoothly with the customer’s existing accounting software and automatically consolidates payments, removing manual tracking and invoicing.
Following further talks, they agreed to a tailored invoice finance solution alongside a Growth Guarantee Scheme (GGS) term loan and top-up, totalling £750,000 to support the management buy in.
The addition of a GGS term loan and top-up provided an injection of capital to boost growth plans post-acquisition. This government backed loan supports access to finance for UK SMEs looking to grow, offering additional funding which operates alongside their existing invoice finance facility.
The result
The company’s change in ownership was managed with minimum disruption, and operations continued seamlessly. By eliminating time-consuming manual processes with the previous invoice finance facility, the team has been able to focus on supporting the new leadership and planning for expansion.
The incoming and existing management teams worked effortlessly together, positioning the business for the next stage of development without the worry of cash flow or further administrative burdens.
