Background:
Our client aimed to significantly expand their food and beverage manufacturing operations into new territories within Western Europe. This ambitious expansion plan required a substantial amount of capital to finance the growth initiatives, including but not limited to, infrastructure development, market entry costs, and operational scaling.
However, the company faced a critical challenge: the high level of debt needed for such an expansion coupled with insufficient security coverage made it difficult to secure traditional financing. Despite the company's established market presence and solid business model, the majority of banks and financial institutions were reluctant to provide the necessary funding. The primary stumbling block was the mismatch between the quantum of debt the company required and the security it could offer, alongside the perceived risks associated with the expansion into new, potentially untested markets.
In response to these challenges, our team stepped in to provide specialised financial advisory services. Recognising the unique needs of the client and the limitations of conventional financing options, we leveraged our expertise and extensive network to identify a suitable funding solution. Our approach led to the discovery of a unitranche
private credit facility, a novel financing structure that blends elements of both senior and junior debt into a single debt instrument. This solution was particularly appealing because it offered the flexibility and the amount of capital required by the client, without the constraints of traditional senior debt structures.
Through our network, we successfully connected the client with a fund that was prepared to offer the necessary capital in the form of a unitranche term loan. This financing solution provided several advantages, including a streamlined lending process, quicker access to funds, and a repayment structure tailored to the client's cash flow capabilities. As a result, the client was able to secure a £6.5 million financing package, enabling them to proceed with their expansion plans into Western Europe without the need to compromise on their strategic objectives or dilute equity.
The successful securing of the unitranche private credit facility marked a significant milestone for the client, allowing them to embark on their expansion journey with confidence. It also underscored the value of having a knowledgeable and resourceful financial advisor capable of navigating the complexities of the financing landscape to find innovative solutions that meet the specific needs of businesses looking to grow and explore new markets.
