Ultimate Finance, the Bristol-based specialist in providing finance to SMEs, has extended its £34m back-to-back facility with Lloyds TSB Commercial Finance for an additional year to support the group's on-going growth.
The contract, which has a new three-year minimum term, effectively extends the facility through to June 30, 2014.
The bank raised Ultimate's facility to £34m following the purchase of Manchester-based Ashley Commercial Finance a year ago – and the group says the headroom of this facility, which now stands at £6.3m, is sufficient to support its continued growth.
Meanwhile its asset finance subsidiary, Ultimate Asset Finance, has been boosted by new facilities from Siemens Financial Services and Hitachi Capital. It was set up in July 2010, to provide commercial hire purchase facilities to small and medium-sized businesses to help with the purchase of standard plant and machinery.
Ultimate says the subsidiary has grown more quickly than expected, exceeding management expectations by reaching break-even in the first three months of trading in the current financial year. Due to the increased pace of growth and low levels of bad debt, Siemens Financial Services has increased its funding facility from £500,000 to £1m while a new facility of £500,000 has come from Hitachi Capital. Together with an original £500,000 facility from Singers Corporate Asset Finance, this has increased the combined total external funding available to the subsidiary to £2m.
Ultimate says that as bank lending to SMEs is increasingly restricted in the current climate, the benefits of its flexible and fast-moving solutions "become even more compelling".
Group founder and CEO Richard Pepler said the support of Ultimate's existing backers demonstrated their "confidence in our continued growth prospects. Additionally, we are particularly pleased to have engaged in a relationship with Hitachi Capital, a new facility provider to the Ultimate Asset Finance subsidiary, which is exceeding management expectations so far this year."
