With businesses coming out of hiding, Phil Woodward asks whether alternative forms of financing could pave the way for growth?
The ups and downs of business can be extreme when exiting recession, but over the past few months we have been seeing greater confidence from our existing clients. They are beginning to grow turnover levels again and many are looking at expansion.
New business has also taken an interesting turn. We are seeing an increasing number of transaction and higher-end refinancing opportunities, which indicates that business leaders are now starting to look forward to the future. This is a significant shift since this time last year.
Leumi ABL is working closely with a wide range of clients, giving them the confidence to implement plans not only in growth funding but also increased working capital provision as it leverages funding against a business’s balance sheet assets rather than relying on personal security or bricks and mortar.
For businesses, including those in turnaround, asset-based lending provides more flexibility than traditional highly covenanted bank funding, which is rarely available at workable levels these days.
One of Leumi ABL’s recent achievements was SMS Electronics. We helped the business to significantly increase their export trade and SMS Electronics has just been named number one in the Sunday Times International Track 100 ranking. This was a company that had experienced inflexibility from traditional lenders, but Leumi ABL recognised the potential in their business and worked with them to find a funding solution.
Another recent deal saw Leumi ABL support the management buy-in of Dawson Home Group, a supplier of luxury home textile products including bed linen and towels, which was being sold by parent Dawson International. The eight-figure ABL deal, consisting of an invoice finance facility and stock finance, will help to strengthen Dawson Home Group’s competitive position.
As increasing numbers of proposals continue to come through from corporate finance boutiques and venture capitalists for larger and more multi-asset-based deals, Leumi ABL is well placed to support businesses seeking flexible financing to fuel their growth plans.