Close Brothers supports manufacturing acquisition with £14.5m ABL facility

Close Brothers Invoice Finance has supported the strategic acquisition of a long-established aluminium die-casting manufacturer with a tailored £14.5 million asset-based lending (ABL) package.

The funding enabled the engineering group, which supplies specialist components to the automotive, aerospace, defence and construction vehicle sectors, to complete the acquisition while maintaining day-to-day liquidity throughout the transaction.

Established in 2002, the business identified the acquisition as an opportunity to broaden its manufacturing expertise by bringing specialist aluminium die-casting, machining and finishing capabilities in-house. The deal also enables the company to diversify its customer base and gain greater control over its supply chain.

Close Brothers said the transaction required a flexible funding structure to support the acquisition while protecting working capital during what remained a challenging trading environment for the automotive supply chain.

To meet those requirements, the lender structured a £14.5 million asset-based lending facility combining invoice finance and a cash flow loan. The invoice finance element released capital tied up in unpaid invoices to support ongoing operations, while the cash flow loan provided additional liquidity to fund the acquisition and integration of the two businesses.

The wider funding package also included support from Close Brothers Asset Finance, which refinanced existing plant and machinery through a sale and hire purchase back arrangement. The structure enabled the engineering group to unlock capital from existing assets while continuing to use essential manufacturing equipment.

Close Brothers worked closely with the client, its professional advisers and other stakeholders throughout the transaction to ensure the acquisition progressed smoothly with minimal disruption to normal business operations.

The acquisition has now completed successfully, bringing the die-casting operation into the engineering group and strengthening its manufacturing capabilities across multiple industrial sectors.

The enlarged business has expanded its customer offering while increasing control over its supply chain and reducing its dependence on demand from a single market. The transaction also supported a smooth ownership transition for the acquired business, ensuring continuity for customers, suppliers and employees.

Close Brothers said the flexible funding structure has provided the enlarged group with a stable financial platform to integrate the two businesses while positioning it for future growth opportunities.

The transaction highlights the role that asset-based lending can play in supporting complex acquisitions, combining working capital facilities with asset finance to help manufacturers pursue strategic expansion while maintaining operational stability.