Ultimate Finance provides £450,000 invoice finance facility to Cats & Pipes

Ultimate Finance has provided a £450,000 invoice finance facility to UK engineering and manufacturing business Cats & Pipes Limited as the company continues its recovery following a major cyber-attack.

The facility has been structured to support Cats & Pipes’ working capital requirements, including funding against European export debtors and accommodating a relatively concentrated customer base.

Cats & Pipes specialises in catalytic converters, diesel particulate filters and emissions control components, supplying customers in the UK and Europe as well as distributing its products globally.

The company has been trading for more than 25 years and operates with a relatively small number of repeat customers, resulting in higher exposure to individual debtors than would typically be found across a more diversified sales ledger.

Cyber-attack creates working capital pressure

Cats & Pipes’ funding requirements followed a cyber-attack in August 2023 which erased its systems, including two backups, disrupting operations and affecting activity levels and customer retention.

The company subsequently faced a lengthy wait for its business interruption insurance payment, which took around 15 months to arrive. During that period, additional borrowing was required to maintain trading and retain its workforce.

Working capital pressures were compounded when its existing invoice finance provider reduced its support and asked the business to find an alternative funder.

Finance For Business UK Limited introduced Cats & Pipes to Ultimate Finance, with the manufacturer requiring a facility that could provide higher funding levels while supporting export debt and its concentrated debtor profile.

Chris Rimmer, introducer at Finance For Business UK Limited, said: “The business needed a funder who understood the reality of turnaround – and who could still move at pace while getting comfortable with export funding and concentration risk.”

Export invoices included in facility

Ultimate Finance subsequently agreed the £450,000 facility, which includes funding against European invoices through inter-factoring.

The structure also accommodates Cats & Pipes’ high exposure to one particular debtor, reflecting the manufacturer’s reliance on a smaller number of established customer relationships.

Sarah Harrison, regional director at Ultimate Finance, said: “We looked carefully at debtor quality, trading relationships and export dynamics – then built a facility that matched that reality.

“Inter-factoring and concentrated ledgers can be completely fundable, as long as you take the time to understand the underlying story.”

According to Ultimate Finance, the new facility has helped relieve Cats & Pipes’ immediate cashflow pressures and maintain trading as it continues its recovery.

Harrison added: “This facility gives the business room to breathe. The priority is keeping operations moving while they complete their wider recovery – and putting them in a stronger position to grow from there.”