New debt facility supports Begbies Traynor acquisition programme

Manchester-based insolvency specialist, Begbies Traynor, has agreed a new debt facility with HSBC Bank.

The deal, which has a potential maturity date of February 2029, lays the foundations for further acquisitions by the group.

In its previous financial year the professional services consultancy, which operates financial advisory and property advisory divisions, completed three acquisitions, adding Banks Long & Co, a general chartered surveyors practice, based in Lincoln, a Cardiff-based insolvency team from Jones Giles & Clay, which joined the group’s existing Cardiff office, and Andrew Forbes, a property valuation practice based in Bristol.

During the current fiscal year it acquired Nottingham-based SDL Auctions last December, in a deal worth up to £3.25m.

The new debt facility replaces the group’s existing arrangement with HSBC which was entered into in 2016 and was due to mature in August 2025.

It provides a £25m committed, unsecured revolving credit facility, which is unchanged from the previous facility.

An additional £10m accordion facility, increased from £5m, allows further debt capacity to support the group’s growth strategy, subject to certain conditions.

Begbies said the overall costs are broadly in line with the previous facility.

The new deal will run with an initial three-year term until February 2027, with two one-year extension options, giving a potential maturity date of February 2029.

Executive chairman, Ric Traynor, said: “We are pleased to have agreed a new debt facility with HSBC which, alongside the group’s cash generation, provides us with the flexibility to complement our organic growth with selective acquisitions.

“This will enable us to both build on our decade long track record of growth and execute our strategy to extend our scale and range of services.”

The group has also issued a trading update for its third quarter period, ending January 31, 2024, which revealed that its financial performance has been consistent with its expectations. Both divisions are trading in line with the outlook stated at the time of the half year results in December 2023.

Consequently, the group’s outlook for the year as a whole remains unchanged and the board said it remains confident of delivering market expectations for the full year, extending the group’s strong financial track record of growth.

The current range of analyst forecasts for the financial year are for revenue of £131.1m-£135.2m and adjusted profit before tax of £21.9m-£22.5m.

Ric Traynor said: “We have continued to perform well across the group and our outlook for the full year remains unchanged, which will extend our strong financial track record of growth.”

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