Electro Plating & Metal Finishing
NATURE OF BUSINESS | Electro Plating and Metal Finishing |
STAGE OF DEVELOPMENT | Established (Annual turnover £3m+) |
INVESTMENT BEING SOUGHT | Up to £500,000 co-investment (Minerva Members alongside a Venture Capital Fund) |
20% EIS TAX RELIEF POTENTIALLY AVAILABLE | Yes |
PREPARED TO HAVE MULTIPLE INVESTORS | Yes |
EQUITY STAKE | Realistic |
INVESTOR PARTICIPATION | Non-exec or part-time |
MANAGERIAL SKILLS SOUGHT | Business development and/or financial |
LOCATION | Birmingham |
A long established company, now under a new generation of management, seeks capital to re-structure its finances and to allow it to pursue controlled and profitable expansion. Its capital base has historically been poorly structured, resulting in heavy financing costs (leasing, invoice discounting and loans) that turned an otherwise profitable business into a loss maker.
The company has state-of-the-art plant and processes (attracting prospective customers), a long leasehold site in a busy part of the city, a highly diversified customer base and new management that is experienced and ambitious. Sales activity has been increased, so that despite uncertainties in the general economy a 20% increase in turnover over the next 2 years appears to be a realistic prospect.
Greater plant utilisation and tighter controls to reduce waste will help to maintain gross margins. The new Managing Director is currently streamlining the company's outdated management processes to both increase efficiency and reduce overheads. The company will by that time be well positioned to benefit from an eventual upturn in the economy.
Restructuring the company's finances will immediately allow it to reduce its crippling financing costs and at the same time give it the capacity to attract and process a bigger turnover. It is anticipated that Minerva Members will invest in parallel and on agreed terms alongside a venture capital fund that will conduct due diligence and provide the bulk of the funding. The incoming investors' need for an exit route years is recognised, and will be reflected in the investment documentation.
Further information: Harry Stott, University of Warwick Science Park Limited
024 7632 3123 or capital@uwsp.co.uk
Investment in new business carries high risks as well as the possibility of high rewards. It is highly speculative and potential investors should be aware that no established market exists for the trading of shares in private companies. Before investing in a project about which information is given, potential investors are strongly advised to take advice from a person authorised under the Financial Services and Markets Act 2000 ("FSMA") who specialises in advising on investments of this kind. The University of Warwick Science Park Limited ("UWSP") is not authorised to arrange transactions or circulate offer documents under FSMA and cannot advise on the merits or risks of investment.