Funding body Finance Birmingham has announced its second deal in just a week after it backed a manufacturer of automotive parts to the tune of £1 million.
Magal Engineering has secured a contract to supply Jaguar Land Rover's (JLR) new engine manufacturing site near Wolverhampton and required the funding to purchase new equipment.
The capital from Finance Birmingham has created 12 jobs and secured a further 56 at the company and follows last week's news that it had backed Erdington-based design agency Green Room to recruit 40 more staff.
Magal Engineering designs and makes automotive components for global names including JLR, Ford and Daimler but to operate at full capacity for the new contract, it required finance for a suite of tools to make the components.
The cost of this will be reimbursed by JLR once full production has begun.
The loan supplied by Finance Birmingham ensures Magal Engineering has the initial funds to obtain the correct tooling for the contract.
It was secured from the national £24 million Tooling Funding Programme which is part of the Government's Regional Growth Fund.
Chief executive Gamil Magal said: "Magal's ability to supply components to Jaguar relied on our ability to acquire new tools and take on more staff.
"Finance Birmingham's loan will enable us to deliver this contract efficiently and on time.
"This is a new step forward for Magal, which will help us to realise our future as an integral part of the UK's growing automotive sector."
Steve Hetherington, tooling investment director at Finance Birmingham, advised Magal and helped to prepare the company's bid for the loan.
He said: "The strength and reputation of the UK's automotive industry continues to gain momentum, providing new opportunities for its suppliers.
"Magal's new contract with Jaguar highlights how expertise within the automotive supply chain is winning work and creating new jobs.
"The Tooling Funding Programme is open for business and we hope to help many more companies achieve these goals."