Fairpoint secures £13m refinancing
DEBT advisory firm Fairpoint has announced that it has agreed a new £13m asset-backed lending (ABL) facility with US-based PNC Financial Services.
The revolving credit facility is secured against revenues generated from customers IVA and debt management books, and it replaces an existing £8m bank loan. Only £4.5m of this was drawn down, though.
Chorley-based Fairpoint said that the costs of financing the facility is expected to be around £200,000 higher than its previous deal and cost £200,000 in fees to establish.
The company, which trades under the Debt Free Direct, Clear Start and Money Extra brands, also announced that it had received a rebate of £9m from HMRC, which relates to a successful challenge made by Manchester-based Paymex last year on VAT payments levied against debt management and IVA plans.
Fairpoint said that the money is currently sat in a client account and it is in the process of applying refunds across both open and closed customer cases.
It added that this “is anticipated to result in additional distributions to creditors and exceptional fee income for the group”.
Chief executive officer Chris Moat said: “The new facility, together with the proceeds of the VAT reclaim, provides the group with significant liquidity and a longer term financing structure, which will enable us to continue our strategy of both organic and acquisition investments in order to consolidate our market position and diversify into related activities.”
