ThinCats announces £200m SME fund

ESF Capital, together with its operating subsidiary, Ashby de la Zouch-based ThinCats, has finalised a funding programme for loans of up to £5m for UK SMEs.

This £200m fund includes £30m already committed by ESO Capital, £70m from Waterfall Asset Management, and the balance to be provided by Waterfall and other institutional investors, subject to certain conditions. All funds under the programme will continue to be invested in loans originated through ThinCats.

ThinCats says lending will focus on funding growing companies with asset backing and reliable cashflows, including acquisition finance, across all regions and sectors in the UK.

ThinCats chief development officer, Damon Walford, said: “This additional investor base will allow us to significantly increase funding for small businesses’ expansion, acquisition or refinancing plans. Our focus on providing amounts up to £5m based on assets and reliable cashflows means we occupy a space where traditional providers ‘can’t work’ rather than ‘won’t work’.

“We have built an impressive team to service the market focussed on working alongside professional intermediaries to source opportunities and this funding ensures we are able to provide certainty to borrowers and their advisers.

“This is a significant stage in the continued development of our business, which we plan to significantly increase over the next two years and we are excited by what the future holds.”

Henrik Malmer, managing director at Waterfall said: “ThinCats occupies a unique space in the market and we are pleased to invest in senior secured loans made to growing and ambitious small businesses, which we see as a positive addition to our portfolio.“

ESF’s managing director, Ravi Anand, said: “ESF has engaged across the institutional market and this is the first key initiative in our plans to provide significant funding to the UK SME market. Generating a strong and sustainable yield from providing finance for small and growing businesses is a compelling alternative to traditional fixed income investments when combined with the funding gap left by conventional lenders.”