Sourcing a debt facility for a UK subsidiary

Background

A privately owned US parent company, with revenue of more than $1 billion, wanted to secure a debt facility for its UK subsidiary. The company operated within the corporate barter sector, which is highly specialised with only a small number of UK market players, so it was an unusual and uncommon proposition for lenders. The major US lender could not lend outside their home market, so introduced FRP to source and advise on the UK debt facility.

Action

Our Debt Advisory team looked to source a new debt facility for the UK subsidiary through a competitive refinancing process. Led by FRP Partners Nick Grainger and Andy Dimmock, the team spent a considerable amount of time with the client to understand the unique characteristics of the business, so that these could be simply articulated to a lender audience. Offers of finance were sourced from asset-based lenders, debt funds and banks, with a variety of costs, structures and due diligence requirements.

Outcome

The successful lender, which had little previous experience of the company’s nature of operations, provided a revolving credit facility with a limit considerably in excess of the company’s original target range. The facility also allowed funds to be transferred within the wider corporate group, another key requirement stipulated by the US parent.