Asset finance can play an important part of the overall consideration in a management buyout. Although it is often the last piece of the jigsaw it can make the difference between making a deal happen and not making a deal happen. Furtherm0re it is imperative that you get a decent asset finance broker to coordinate the best possible deal.
I suppose it is good news that we are continuing to receive business finance enquiries for new start businesses. The most recent one of which is for a £40,000 LCD exhibition screen. The discussion with the directors prompted me to remind oneself of the process required for funding a new business with very little trading history.
We have come across a very interesting scenario in the last week or so whereby another broker had bee quoting a very very cheap rate on a hire purchase deal. Not wishing to criticise my fellow broking colleagues I suggested to the customer that maybe not all is at it should be.
Love or hate them pe organised administrations or prepacks are an inevitable part of the economy today. In theory they sound great. Dump the old company together with all the old debt ( mainly crown arrears) , buy the business back off the administrator and start a fresh with a new meaner and leaner phoenix company. It has been well documented that obtaining cash flow finance such as factoring or invoice discounting can be relatively straight forward however it may not be so simple in transferring existing hie purchase and leasing facilities from the old co into the new co.
In the last month or so a new asset funder has entered the broker market providing a much needed alternative to ING Lease. Aldermore Bank have entered the asset finance market as a direct competitor or alternative to ING.
It is possible to refinance existing plant and machinery in order to release cash for any purpose ( within reason ) Provided there is equity within your plant and machinery there are a number of finance companies that will advance cash via a sale and lease back or sale and hire purchase back agreements. And provided your business isnt on the verge of going bust you can release cash for most purposes including providing a deposit for a new machine , paying crown arrears of provided working capital to nge better payment terms with your suppliers
At a time when many of the high street banks and finance companies are still difficult to deal with it is imperative than any application for hire purchase or leasing facilities to the few remaining finance companies are presented in the best possible format. At XL Business finance we have over ten years of experience and expertese in organising competitive finance facilities for a variety of businesses. The following will give you an idea of the type of information that we will collate and present to the finance company.
Last week XL Business finance was approached by a London based printing company that needed finance for a second hand print ppress costing approximately £80,000. Although the business was profitable and there was a strong rational for the purchase the deal did not tick all the right boxes for a high street finance company. A well known print finance company was fully exposed at around £250k and were unable to advance an further funding. We received the enquiry via our website and very quickly we were able to secure a hire purchase facility with a privately owned leasing company. This is a prime example as to how a asset finance broker can add value when it comes to organising hire purchase and finance lease facilities.
To ensure that you get the best possible deal when financing your capital equipment you should use a well established and reputable asset finance broker that has been around the block a few times and knows and understands the leasing and hire purchase market. Beware of the retired or recently made redundant bank manager as they have absolutely no idea what is available or achievable in the asset finance market. As one of the countries leading asset finance introduces we know exactly which finance companies finance what sort of assets for what sort of businesses.
Any business wishing to purchase plant and machinery will know that the banks at the moment are not the most accommodating when it comes to asset finance. During the credit crunch any independence the bank owned leasing companies had will have been pulled back in under the umbrella of the main bank. What this means is that now there very little difference in applying for a commercial bank loan or a hire purchase or leasing facility. Indeed you will find that your application for either will probably go to the same underwriter for approval. Never has it been truer that the banks will take into consideration you overall exposure when approving any type of borrow including any outstanding finance lease facilities.
XL Business Finance Ltd is a privately owned and independent business financing company with established links to many of the UK's leading finance houses. XL Business Finance provides a viable alternative to high street banks that lack the flexibility and imagination to provide a solution to most business users requirements. XL Business Finance can provide a full range of business financing solutions and we ensure a high level of customer service and pride ourselves on quick decisions. Our independent status will ensure any offer of funding and asset finance leasing is best suited to our customer’s needs.
XL Business Finance, Eaton Place Business Centre, 114 Washway Road, Sale, Cheshire M33 7RF UK.
