Case Studies
€800K Bridging Finance Enables SME to Deliver Highly Profitable Contract
A huge thanks to Clancy Business Finance for making this possible – you’ve made all the difference.
The Outcome
- €800K equity release completed within three weeks
- Funding raised against unencumbered property
- Funds injected into the business as a director’s loan
- Working capital provided to fulfil the contract
- Suppliers and creditors kept onside and paid quickly
- Major new profitable contract delivered on time
1.
Summary
The flooring contractor had secured a major new contract that represented an important opportunity for the business. However, the timing of customer receipts created a working capital requirement that could not be met through its existing banking arrangements. CBF was approached to find an alternative solution and identified equity release from the promoter’s unencumbered property as a way to provide the required funding.
2.
Challenge
Recent financial performance meant the business fell outside bank lending criteria, despite having secured a profitable contract with a strong customer. The extended payment terms put pressure on working capital, while suppliers still needed to be paid throughout the contract. The business therefore needed access to finance without relying on its recent trading performance or putting further pressure on day-to-day cash flow.
3.
Approach
Working alongside the client’s accountant, CBF reviewed the available options and identified business bridging finance as the most suitable route. The promoter had unencumbered property that could be used to raise the required funds. CBF introduced a specialist funder and arranged an €800K equity release against the property, with the facility completed within three weeks. The funds were then injected into the business as a director’s loan.
