Case study: Securing funding post-recession to meet growing demand

By Paul Mankin

The recession presented UK businesses with a number of challenges including making difficult strategic decisions. Do you cut back investment and restructure your cost base? Do you realign your strategy towards more resilient markets sectors or do you hold your nerve and continue to invest through the downturn?

Now, as the economy recovers, businesses are facing equally difficult decisions to ensure they are best positioned and adequately funded to take advantage of the growth.

The recent investment in Express Engineering (Holdings) Limited (“Express”), a UK based precision engineering company, by Lloyds Development Capital (“LDC”), a private equity house, has demonstrated that capital is available to ambitious companies who are seeking to expand their operations.

In the last five years Express has continued to invest to more than double both its manufacturing floor space and staff. This is part of a wider strategy to focus on aligning itself with high integrity, precision engineering sectors such as aerospace and oil & gas and also establishing a Brazilian joint venture.

Despite investing throughout the downturn, further expansion of the company’s UK and Brazilian operations was essential to allow Express to continue to meet the rising demand from its global customer base.

Drawing on our extensive knowledge of the private equity market, we were able to advise Express and its shareholders throughout the process to secure the development capital from LDC. The funding will be used to expand operations at the company’s Gateshead and Brazilian sites as well as at its newly acquired Stokesley site, where Express acquired the trade and assets of Burdon Limited in the months prior to the investment by LDC.

Nigel Davison, Managing Director of Express said “Our business has grown rapidly in recent years to become one of the leading players in the precision engineering market. The investment, alongside the operational support from LDC, will strengthen our ability to service a flourishing domestic oil and gas sector, further develop our manufacturing operations in Brazil and explore other foreign market opportunities for growth.”

So there are options available to businesses facing the challenge of securing investment for their existing operations and in support of acquisitions as part of a wider growth strategy.

Did you need to meet rising customer demand throughout the recession and, if so, how did you fund capital investments?