Midlands law firm Browne Jacobson is celebrating after providing the legal support to a new government business finance scheme.
Browne Jacobson advised KeTech Group on a landmark £4.5 million re-financing deal. The deal was the first of its kind in the country to be backed through the Government’s Capital for Enterprise Fund.
The company is to receive £2 million from the Enterprise Fund as part of a £4.5 million refinancing that includes £2.5 million in invoice discounting from Centric Commercial Finance.
Richard Cox, corporate partner at Browne Jacobson, led the team that advised KeTech’s management. The fund manager was Octopus Investments Limited.
KeTech, which employs more than 100 people at six UK sites, makes devices which are used by the armed forces, police and professional security services to detect hidden objects such as explosives, chemical weapons and drugs. It also sells software integration services to companies like Chiltern Railways, Metronet and Mitie.
The £75 million Capital for Enterprise Fund was set up by the Government in partnership with a number of financial institutions. It is made up of £50 million of government funds and an additional £25 million from Barclays, HSBC, Lloyds TSB and RBS.
The purpose of the fund is to provide equity and quasi equity of £250,000 to £2 million for companies with a turnover of up to €50 million who have viable business models and growth potential in need of long term capital. The Fund is managed by professional experienced fund managers such as Octopus on behalf of the Government.
The Browne Jacobson deal comprised Richard Cox and Richard Medd (Corporate), Paul Ray and Faizal Bhana (Banking) and Andrew Noble and Beth Dowson (Tax).
Richard Cox, Corporate Partner at Browne Jacobson, said : “This is a landmark deal and one which we are delighted to have been involved with.
‘‘The Enterprise Fund was set up to help essentially sound businesses that have real growth potential but have struggled to secure the necessary financial backing to achieve their ambitions.
“KeTech is a perfect example of this and this latest injection of cash will help the company to plough ahead with its future expansion plans.”
While Nottingham-based KeTech was awarded £2 million through the scheme, a further investment of £1 million was made to Glasgow-based Vamosa, which provides IT systems to businesses and the public sector.
When launching the scheme earlier this month, business secretary Lord Mandelson said: ‘Ambitious and innovative businesses like these are the lifeblood of the economy, but tough credit conditions can make it difficult for them to invest in their future.”
