LSL secures £100m bank deal to fund acquisitions
ESTATE agency group LSL Property Services has secured a new £100m banking facility that will allow it to make further acquisitions.
The four-year facility, which matures on August 31, 2017, is with a syndicate of four banks – its existing banks Barclays and Lloyds Banking Group plus HSBC and Santander.
Each bank has committed funding of £25m towards the facility which comprises a £95m revolving credit facility and a £5m overdraft facility.
LSL, which also has a surveying arm, has significant operations in York but has its registered office in Newcastle.
It operates the Your Move, Reeds Rains, Marsh & Parsons, Intercounty, Frosts, JNP, Goodfellows, Davis Tate and Lauristons estate agency brands.
In January 2010 the acquisition of the Halifax Estate Agency business from the Lloyds Banking Group saw LSL increase in size to become the second largest UK estate agency network – with around 533 branches. It is also the largest lettings agency in the UK.
The new deal replaces LSL’s existing funding package of £75m which provides finance for both working capital and acquisitions.
The amount of the new facility has been increased to provide additional debt capacity in line with the increase in group profitability over the last three years.
The financing costs on the new arrangement are comparable to that of the old facility and will vary based on both facility utilisation and the net debt to EBITDA ratio of the group.
Steve Cooke, LSL Group finance director, commented: “We are delighted with the support shown by our banking partners and are pleased to welcome HSBC and Santander into our banking arrangement. The new facility will enable LSL to continue to deliver its strategy of investing in organic growth initiatives and making selective value enhancing acquisitions.”
Martin Lunt, HSBC head of corporate for Yorkshire and the North East, said: “LSL Property Services has undergone significant recent expansion and is well placed to benefit from the renewed strength of the housing market on both sales and lettings. This latest finance package will give it the ability to continue its strong growth path through a combination of organic expansion and strategic acquisitions.”
HSBC’s team on the deal was led by senior corporate banking manager Neil Abbott.
