The Yorkshire-based specialist manufacturer and distributor of glass bottles and containers to the premium spirits and food & beverage sector produces 600 million bottles per annum across 450 product lines.
Investec invested time with management and put together a bespoke debt structure comprising a mix of asset-based and cashflow lending to support the company’s long term growth, working capital and seasonality requirements. The package incorporates a blend of evergreen revolvers against receivables and inventory as well as an amortising term loan, as opposed to traditional senior debt structures which incorporate ‘bullet’ repayments. Investec’s structure replaces the ‘bullet’ with evergreen revolvers allowing management and shareholders flexibility to invest, grow the business, and realise value in their own timeframe.
The debt package was delivered by Investec’s specialist ABL & Cashflow team comprising James Cullen, Paul Rablen and Steve Ive.
Alan Henderson, chief executive, Allied Glass said: “The team at Investec designed a blended funding structure specifically for our business’s shape and needs, giving us the firepower and headroom to take advantage of growth in our market. This structure was delivered by a single team at Investec that will remain as the relationship team, which is hugely important to us and gives clarity on both sides”.
James Cullen, Investec, commented: “We regard the Allied Glass management team as best-in-class and we’re delighted to be partnering with them at a really exciting time in their story. This transaction is a great example of our strategy to support great British businesses, putting them on the front foot to compete in a global marketplace post-Brexit. A changing economic landscape requires a shift from a traditional debt approach to more flexible financing.
“Manufacturers and distributors are well suited to asset-based and cashflow lending debt structures because they have high levels of balance sheet working capital within receivables and inventory alongside cashflow to service term lending. We’re keen to work with great management teams in compelling businesses such as Allied Glass”.
Allied Glass currently has a 25% market share in its key segment of premium Scotch whisky bottles and the business differentiates itself on innovation, speed to market, premium-end products and shorter production runs.
Source: News – Packaging News