Refinancing deal will enable food ingredients firm to pay off some debts
Liverpool-based bakery ingredients business Real Good Food has secured £8.87m in a refinancing package which will allow it to repay some of its debt facilities.
The firm has received the funding boost from Leumi ABL Limited.
It said it will pay off certain debt facilities provided by its three major shareholders, NB Ingredients Limited (Napier Brown), Omnicane International Investors Limited, and certain funds managed by Downing LLP.
The facilities comprise a £5.45m receivables facility, a £1.3m term loan facility – each with a 60 month term – and a £2.12m plant and machinery facility with a 36 month term.
The Facilities carry early termination fees of three per cent in the first year, two per cent in the second year and one per cent in the third and subsequent years and have standard financial and performance covenants.
Real Good Food said £4.5 million of shareholder debt is to be repaid from the proceeds, £3.624m of principal, £0.604m of interest and £0.272m in redemption premium; Napier Brown will receive £1.627m, Omnicane £1.626m and Downing £1.247m.
The new arrangements will see a reduction in the annual interest charge of some £250,000. The balance of the funding will replace the existing CID and asset-based facilities.
Real Good Food chief executive Hugh Cawley said: “We are delighted with the support we have received from Leumi in the form of the facilities, as we seek to normalise our facilities with a better balance of bank funding and shareholder support.
“The bank’s support underpins the work the board has undertaken in streamlining the business units of RGF in order to drive the group towards consolidated profitability.”
He added: “I would also like to thank our major shareholders for the financing they have provided over the past few years to ensure the financial survival of the group as we have worked to turn RGF around.”
Last week the struggling business announced annual pre-tax losses of £26.1m, compared with £9.1m the previous year.
