MGB takes a new line in rail finance
Plymouth-based MGB, which specialises in engineering for safety critical industries, is gearing up for growth thanks to the planned investment in the UK rail network and an innovative injection of crowdlending.
The company, which was formed in 2004, has secured £500,000 in funding from leading UK crowdlender Archover based on secured contracts and its potential to secure more when Network Rail Control Period 5 Delivery Plan (CP5) kicks in later this year.
In recognising the opportunity presented by the planned £40bn rail investment, MGB decided to take a fresh look at finding the right finance partner through leading commercial finance brokers Balance for Business.
Dave Ottley, Managing Director at Balance for Business, explained: “Clearly the banking landscape has changed dramatically since MGB set up as a business. This change has been positive with the introduction of new funders who are geared up to support ambitious companies such as MGB. With an established relationship in place, I knew ArchOver was a great fit for my client.”
Angus Dent, CEO at ArchOver, said: “MGB has contracts agreed and has invested heavily in high quality people, processes and machinery which presented a very attractive proposition for our investors. We’re very pleased that crowdlending will provide MGB with the financial flexibility and support it needs to deliver its growth plan.
Stuart Morrison, Director at MGB, commented: “We are delighted that ArchOver believes in our business case and is investing in our growth plans. Their approach is innovative, modern, appropriate and available; it’ll play an important part in our future success.”
Alongside the rail portfolio, MGB has also designs and manufactures equipment for the Marine and Petro Chem Industry.
More information on the finance model
ArchOver’s crowdlending platform uses money from investors and lends directly to borrowers, providing businesses with a lump sum for a fixed term of up to 36 months, which can be extended if required. It can also be repaid or reduced at any time. The minimum borrowing level is set at £100,000 with no maximum.
The loan is secured on the value of the debtor book and that is insured, allowing the borrowing company to lever off the creditworthiness of their customers. ArchOver calls this ‘secured and insured’ lending.