Stowmarket: Muntons underpins growth by securing asset finance deal with RBS and Lloyds
- Credit: Dougy Blanks
Malt and malted ingredients manufacturer Muntons is on track to achieve annual sales of more than £100million after securing a new lending facility.
Stowmarket-based Muntons, which supplies more than 180,000 tonnes of malt products annually to food and drink producers around the world, has already increased its turnover from £54m in 2007 to more than £80m last year.
And sales are now on course to top £100m for the first time this year, with the firm having agreed a joint asset-based funding package with RBS Invoice Finance (RBSIF) and Lloyds TBS Commercial Finance.
The facility will be used to support exporting activity as well as the company’s UK operations, not least by strengthening its purchasing power in the market for barley where prices have doubled in recent years due to poor harvests and increases in demand.
Alan Ridealgh, managing director at Muntons, said: “The UK has experienced some unique weather over the past few years, with long periods of drought and then seemingly non-stop rain, which brings challenges not only for the farmers but also industries such as ours that rely on a ready supply of good quality cereals.
“With extreme weather comes cereal price volatility. We buy in excess of a quarter of a million tonnes of malting barley each year and when the price doubles having access to sufficient funding is an essential.
“The new arrangements we now have in place through RBS and Lloyds TSB Commercial Finance will provide us with the flexibility to cope with these demands and will enable us to grasp opportunities to grow our business profitably.”
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Chris Hawes, director of corporate at RBSIF, said: “Asset based lending is absolutely the correct financing structure given the nature of the Muntons business operation because it provides them with great flexibility and the ability to turn the value of their company assets into much needed working capital that supports the purchase of raw materials.
“We are proud to support UK manufacturing and Muntons are great example of how brand GB is being promoted overseas as they export worldwide via sales offices in Singapore and Seattle. The whole team at Muntons are passionate about what they do and strive to innovate and provide solutions to their customers.”
Ivor McTighe, director of business development, mid markets and global corporates at Lloyds TSB Commercial Finance, added: “Muntons has a solid management team that has worked hard to ensure the business’ growth escalates despite unexpected weather and volatile market conditions.
“This deal exemplifies our commitment to supporting strong British manufacturing businesses and the suitability of asset based lending for firms that need flexible cash flow to capitalise on expansion opportunities as they arise.”