Funding boost to support restructure of leading timber business
Hilton-Baird is delighted to have assisted in securing a commercial mortgage and confidential invoice discounting facility for, Rainbridge Timber Limited to enable the business to realise its plans.
Established in 1983, Rainbridge Timber Limited supplies sawn timbers and specialist pallets for the handling needs of many industrial sectors, as well as manufacturing heavy duty fencing panels and importing birch for furniture frame manufacturing and other market specific timber requirements.
The business enlisted Hilton-Baird’s expertise as it was looking to raise £750K to support the organisational restructure of the business which would see two of the five existing shareholders retire and sell their shareholding to the remaining shareholders.
Rainbridge’s Financial Director, Martin Williams, was keen to find the most suitable method to fund the planned exit of two key shareholders, preferring to keep the invoice discounting facility for the purpose it was intended, to support working capital needs. The preference was to leverage funding against their commercial property via a re-mortgage to enable them to finance the MBO.
The business had received a commercial mortgage offer in February 2020 from their existing CID provider, which was subsequently withdrawn with the provider being unable to support this ‘type’ of lending once the pandemic hit.
Other potential commercial mortgage providers contacted were only prepared to provide quotations based on combining the mortgage, banking and invoice discounting facilities.
For our client, it was important to avoid this route, partly as they were keen to retain the property re-mortgage as a standalone transaction, as well as the fact that their existing invoice discounting facility benefited from a historic cost structure which was low. The quotes received to move this facility to a new provider would have made a move costly and therefore counterintuitive.
Hilton-Baird’s knowledge of the commercial finance market meant they were able to identify and introduce a provider who could provide a standalone commercial mortgage without the need to move the banking or the invoice finance.
However, Rainbridge did allow the provider the opportunity to quote for the banking and invoice discounting elements also and, due to their ability to match the existing structure, subsequently decided to also move these facilities over to the new provider, given that it made commercial sense and they felt happy and confident in doing so.
Martin Williams commented: “We were pleased we had access to Hilton-Baird’s expertise. Their team quickly identified a solution which enabled us to proceed with the planned retirement of two of our valued long-term shareholders, against the challenging backdrop of the wider impact of COVID on commercial funding for such financing requirements.”
“Having the new facilities in place will assist us in pushing forward and maximising opportunities that arise as our sales increase, ownership and management necessarily passes onto the next generation.”
If you’re looking for a funding facility, our team would love to assist. To discuss your requirements and discover the value we can add to your business, call us on 0800 9774833 or request a call back at a time that is suitable for you.
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