Triple funding deal worth £4.75m for edible crops specialist

Cowgills has secured £4.75m of business funding from three different lenders for Manchester-based Cocogreen UK, one of the leading global producers of coir substrate used for growing edible crops.

Close Brothers provided a £3m invoice discount line alongside a £250,000 supply chain finance facility from Whitehall to replace the existing banking lines. A further £1.5m was injected by specialist lender, Caple, to fund the planned growth of the business.

Cocogreen supplies ready-to-use, risk-free coir substrate from coconut husks to berry growers, vegetable producers and nurseries worldwide, including the UK, South America, the Far East and Africa.

In 2018 Prince Charles presented Cocogreen with the Queen’s Enterprise Award in recognition of six years of outstanding growth in International Export Trade.

Ben Day, director of Cowgills’ business funding team, said: “This was not just a complete refinance arrangement with the funding split across three lenders, but also a significant injection of funds when the bank was unable to support the company’s growth plans.

“Caple is a specialist in SME growth credit and was able to provide the unsecured debt finance to supplement the working capital facilities provided by Close Brothers and Whitehall.

“The company was struggling to fund its growth via more traditional sources and was having to turn work away.

“This is the first deal we’ve completed utilising Caple’s unique model and it is a great option for SME businesses that find themselves restricted by traditional lenders.”

Alex Hesketh, partner and head of international at Cowgills, added: “Having worked with Cocogreen for a number of years and having a genuine admiration of the business, it’s really satisfying to see them embark on what will be a phase of unprecedented growth, through the utilisation of their newly-introduced funding facilities.

“To have been able to assist them in achieving this is extremely rewarding.

“Given the international structure of the business, many of the traditional funding options were closed to us on this one, but with some creative thinking, tenacity and teamwork, we were able to achieve a fantastic outcome.”

Thomas Ogden, co-founder and group commercial director at Cocogreen, said: “We’re delighted to have received the funding package supported by Cowgills.

“This shows that our partners have confidence in our consistent track record and historical performance.

“It also highlights support for our business plan and sustainable business model, both of which have enabled the company to become a disruptor and innovator in the fresh produce industry over the past decade.”

Sean Brophy, of Caple, added: “We are delighted to have been able to support the management of Cocogreen with long-term unsecured funding.
“Cocogreen is an innovative and entrepreneurial business with strong environmental credentials and a sustainable growth story.

“The team at Cowgills worked hard to ensure we had the fullest understanding of the Cocogreen business model, and the great growth opportunity ahead of them. I look forward to working together with Ben and the team on many more flexible SME financing solutions.”

Ben Day added: “Caple have a really interesting model in that they rely solely on the relationship between accountants and their clients to release funds.

“We prepared an in-depth funding proposal which included an analysis of the business, its strategy and expected cash flows.

“Caple’s team then assessed this before formalising their recommendation to their funding partners at BNP Paribas Asset Management and no further security or personal guarantees were needed. It is a really great example of how splitting up the funding can be of greater collective benefit.”

Cocogreen is the first and only growing media producer externally recognised for its sustainability, social, ecological and environmental assurance which is traceable from beginning to end.

Launched nine years ago it now employs more than 20 people and the firm has a turnover of £9.5m.

This is the first business funding deal of the year completed by Cowgills’ business funding team which, in 2019, delivered more than £18m of funding in 37 deals, an increase of in excess of 50% from the previous year.