Beechbrook Capital’s second UK SME Credit fund reaches first close at £128m and completes first two investments
06 March 2019
6 March 2019 – Beechbrook Capital, the specialist direct lender, has reached the first close of its second UK SME Credit Fund, with commitments of £128m. The Fund has also made its first two investments, in Hosted Desktop UK and Gravity Global.
Beechbrook’s UK SME Credit II supports small and medium-sized businesses in the UK with a turnover of between £10m and £100m and EBITDA of £1m and above. It will provide mainly senior secured loans to non private equity-backed companies to support acquisitions, buy-outs, shareholder re-alignments, refinancings and general expansion plans.
The Fund completed its first investment in Exeter-based Hosted Desktop UK, a provider of cloud services to UK SMEs, to support a shareholder realignment of the business.
The Fund’s second investment is in Gravity Global, a B2B marketing agency based in London, to support its growth strategy.
UK SME Credit II has attracted a broad mix of repeat and new institutional investors. These include British Business Investments, a commercial subsidiary of the British Business Bank, which also invested in SME Credit Fund I.
Beechbrook partner Paul Shea commented: “We are delighted with the support we have received from both existing and new investors. There remains an acute shortage of development and expansion finance available in the UK lower mid-market and we will continue to play our part in helping fund growth in this important segment of the market.”
Catherine Lewis La Torre, CEO, British Business Investments, said: “Our participation in Beechbrook Capital’s second UK SME Credit Fund will enable additional capital to be invested in promising UK-based SMEs that require growth capital to scale up successfully. Beechbrook’s approach of providing a combination of debt and equity finance meets our objective of promoting greater diversity in the supply of funding solutions for smaller businesses.”
Beechbrook Capital’s inaugural SME Credit Fund, which raised £152m and closed in January 2017, made its 15th and final investment in S:CRAFT, a UK B2B distributor of branded interior plantation shutters, in mid-December. Beechbrook provided a flexible debt and equity solution enabling S:CRAFT’s senior management to take partial ownership of the business through a capital reorganisation.