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Simon Skill

Established in 1936, Higson and Co is an independent firm of chartered accountants and business advisors.  We offer a comprehensive range of accountancy and business advisory…

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Goodman saves over 60 jobs

Source: Paul Goodman
Date: 04.26.11

In February 2011 we were approached by a fellow NACFB member Tom Adams of Affinity Asset Finance. We had been working closely with Affinity over the last few months and had developed a synergy between our two companies. They had a client who was experiencing severe cashflow difficulties which were impacting on the company’s ability to continue to trade and the company’s bank was unwilling to make additional facilities available. The company in question had been trading very successfully for over 20 years and never been in trouble financially before.

We quickly arranged a round table meeting between the client, I and Tom, and after some investigations into their accounting information and going through the business with them I suggested that we consider a pre-pack sale of the business out of an administration. It was unlikely that the administrators would be able to trade the business due to the cash flow constraints and therefore the outstanding wages due to employees of £30,000 could not be funded. If a pre pack sale was achieved the employee’s outstanding wages would be paid, the bank would be repaid in full and it would be the best outcome for creditors. The new company would have no issues with to trade as there was never any bad credit, CCJ’s or arrears. The directors of the company in question were happy to do this.

With this in mind, I contacted Eddie Kerr from PKF in Nottingham. PKF are Patrons of the NACFB and having previously worked with them I knew they were the best team for the job. Eddie quickly came to the table and met with myself, Tom and the client and we worked on a solution for the client as a team.

The client needed asset finance to buy the current vehicles from the company that was being put into administration, so Tom contacted Andy Ribbins of Ultimate Asset Finance. Tom had used Ultimate previously and knew that they would be able to help. Andy worked with Tom and PKF to secure a facility that allowed the client to purchase the vehicles from the old company into the new company so he could continue to use them. An £80,000 asset refinance facility was secured enabling the company to release capital tied up in its existing vehicles to drive the business forward.

The client also needed Invoice Finance to allow him the cash flow going forwards to trade the business over the period ahead so I suggested that we join forces with Paul Atkins at Ultimate Invoice Finance. This meant that Ultimate as a lender had complete comfort around the client and were able to provide a finance facility that was structured around the needs of the business exactly. Knowing how Ultimate work, we were confident that they would be able to very quickly arrange a funding line, in this case £200,000 via a bulk invoice discounting facility which offered an instant cash injection for their client that immediately provided the necessary working capital to allow the business to grow and develop.

For more information on asset finance or business finance in general contact Paul Goodman at Goodman Corporate Consultancy.

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