Beechbrook Capital, the specialist direct lender, has reached the first close of its second UK SME Credit Fund, with commitments of £128m. The Fund has also made its first two investments, in HDUK and Gravity Global.
Beechbrook’s UK SME Credit II supports small and medium-sized businesses in the UK with a turnover of between £10m and £100m and EBITDA of £1m and above. It will provide mainly senior secured loans to non-private equity-backed companies to support acquisitions, buy-outs, shareholder re-alignments, refinancings and general expansion plans.
The Fund completed its first investment in Exeter-based Hosted Desktop UK (“HDUK”), a provider of cloud services to UK SMEs, to support a shareholder realignment of the business.
The Fund’s second investment is in Gravity Global, a B2B marketing agency based in London, to support its growth strategy.
UK SME Credit II has attracted a broad mix of repeat and new institutional investors. These include British Business Investments, a commercial subsidiary of the British Business Bank, which also invested in SME Credit Fund I.
Beechbrook partner Paul Shea commented: “We are delighted with the support we have received from both existing and new investors. There remains an acute shortage of development and expansion finance available in the UK lower mid-market and we will continue to play our part in helping fund growth in this important segment of the market.”
Catherine Lewis La Torre, CEO, British Business Investments, said: “Our participation in Beechbrook Capital’s second UK SME Credit Fund will enable additional capital to be invested in promising UK-based SMEs that require growth capital to scale up successfully. Beechbrook’s approach of providing a combination of debt and equity finance meets our objective of promoting greater diversity in the supply of funding solutions for smaller businesses.”
Beechbrook Capital’s inaugural SME Credit Fund, which raised £152m and closed in January 2017, made its 15th and final investment in S:CRAFT, a UK B2B distributor of branded interior plantation shutters, in mid-December. Beechbrook provided a flexible debt and equity solution enabling S:CRAFT’s senior management to take partial ownership of the business through a capital reorganisation.
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About Beechbrook Capital
Beechbrook Capital, a specialist direct lender founded in 2008, invests in SMEs across a range of industries in the UK and across Europe. To date, it has raised more than €750m through five funds, and has invested in 60 companies in the European lower mid-market.
The firm’s three private debt funds support northern European private equity-backed companies with a typical enterprise value of €10 million to €100 million, investing between €5m and €25m per transaction.
In addition to the private debt funds, Beechbrook’s UK SME Credit funds provide finance to non private equity-backed SMEs in the UK, investing between £5m and £15m per transaction.
The Beechbrook team consists of 20 plus investment professionals located in London, Cork, Manchester and Dublin.
About British Business Investments
British Business Investments is the trading name of British Business Investments Ltd, a wholly-owned commercial subsidiary of British Business Bank plc, the UK government’s economic development bank. It forms part of the British Business Bank’s commercial arm.
British Business Investments aims to earn a commercial return by investing – through finance providers – in smaller businesses and small mid-caps, pursuing investments on a fully commercial basis without receiving any economic advantage from the government. Find out more at bbinv.co.uk.
British Business Bank plc and its subsidiary entities are not banking institutions and do not operate as such. Neither British Business Bank nor its principal operating subsidiaries are authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank plc website.
The investment from British Business Investments into Beechbrook does not amount to any endorsement or warranty from British Business Investments, the British Business Bank plc, or the government of the UK.Back