Hire purchase compliments existing working capital facility to support expansion plans
Widney Manufacturing, a long-standing Birmingham business, has secured a £200,000 hire purchase facility to compliment an existing £1.6 million working capital facility from Lloyds TSB Commercial Finance to support its ongoing expansion, in the UK and internationally.
The business was established in 1886 and originally made horse harnesses and saddle fixings. During the 1930s, the firm launched a glazing system for buses and became a major supplier to the Royal Navy during World War Two.
Today, Widney, which has been based on Plume Street since 1970, employs 130 people and designs and manufactures a range of vehicle windows, sun blinds and telescopic slides. Its products are used in a variety of apparatus, including off road construction vehicles, ATMs and aeroplane seating. Its base of high-profile customers includes JCB and Volvo.
The company currently has a £10 million turnover, 65 per cent of which is made up from export sales. Widney ships its market-leading products to 30 countries globally, including much of Europe, China and the USA.
Six months ago, the business was subject to a management buy out, backed by the current management team. It required an increase in working capital to bridge the gap between settling its own bills and receiving payment from its customers.
Therefore, the firm approached Lloyds TSB Commercial Finance for a funding package, which included a hire purchase facility.
Hire purchase enables it to buy equipment and vehicles upfront, without affecting day-to-day cashflow.
Based on issued invoices, the working capital facility frees up liquidity and creates financial headroom to enable the company to put in place a growth strategy.
Matt Devers, financial director at Widney Manufacturing, said: “We have worked hard to remain true to Widney’s rich heritage and this funding from Lloyds TSB Commercial Finance will ensure we can continue to lead the market both at home and abroad, with freed-up working capital to invest in new products and expand into new countries.
“While the market in the UK remains volatile we are keen to expand our export offering, with our products increasingly being shipped to India and Asia.”
Lauro Rodi, regional manager at Lloyds TSB Commercial Finance, said: “Birmingham has a long history of innovative manufacturing, one which Widney is closely connected with.
“Since the MBO, the management team found it needed to update and improve its capital structure to support the firm’s ambitious growth plans.
“We have worked closely with Matt and the team to put this new line of funding in place which will support the company with day-to-day cashflow requirements, and also its ongoing growth. The firm is now in a strong position to further capitalise on an improving market, both in the UK and internationally.”
September 2011