Case Studies
Invoice Discounting Facility Supports SME Turnaround
Our back was completely against the wall – Clancy got us a fantastic offer of finance, which was a real game changer.
The Outcome
- Additional €500K released from the debtors ledger
- 95% prepayment secured for nine months
- Funding structured around peak season working capital needs
- Funder secured to support the restructure
- Suppliers kept onside, with better pricing negotiated
- Existing €1.5M invoice discounting facility replaced seamlessly
1.
Summary
This €7M turnover food processing business was restructuring following a downturn, with its bank reducing its €1.5M invoice discounting facility and planning to exit. The business had a strong pipeline but needed additional cashflow to trade through the restructure and approaching peak season. CBF introduced a funder willing to support the turnaround and structured an invoice discounting facility with 95% prepayment for nine months, releasing an additional €500K.
2.
Challenge
The business had experienced a decline in turnover, increasing costs and unexpected bad debt and was in the process of restructuring. Its bank was also reducing the invoice discounting facility and moving to exit. This created significant cashflow pressure when the business needed to keep suppliers onside and fund increased working capital ahead of peak season. It needed a funding solution that would support the restructure rather than simply replace the existing facility.
3.
Approach
CBF met with the promoters to understand what the business needed to trade through the restructure and the seasonal increase in working capital. We introduced a funder with an appetite to support a business mid-turnaround and worked with them to structure an invoice discounting facility with 95% prepayment for nine months. The facility was structured around peak season, when the business needed additional working capital most.
