Arbuthnot Commercial ABL supports MDS Civil Engineering MBO with £ 4.5million facility


Arbuthnot Commercial Asset Based Lending has provided a £ 4.5million facility to help MDS Civil Engineering’s management team, Darren Chaston, Richard Pullen and Matthew Pratt, acquire the business from its founder.

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Total funding in support of the Management Buyout (MBO) includes a £ 2.5million line of receivables financing, secured primarily on a borrowing basis of uncertified applications, a factory loan and £ 1.5million depreciable machinery and a £ 500,000 cash loan. Founder Roy Marfleet begins phasing out following the deal.

MDS is an earthworks and civil engineering company which provides services to leading leading developers in Essex and East Anglia. The group operates primarily in the housing sector and counts Bellway, Redrow, Cala, Linden, Taylor Wimpey and Persimmon among its clients.

Since its inception in 2000, MDS has grown to become one of the region’s leading entrepreneurs. Operating from a purpose built facility in Halstead, Essex, the company employs around 150 people and has contracts ranging from £ 100,000 to £ 15million.

Commenting on the transaction, Matthew Pratt, CFO of MDS Civil Engineering, said: “Prior to our first meeting with Arbuthnot Commercial ABL, their team called us to request additional information and demonstrated a good understanding of our industry and its cycle. specific working capital. . This level of expertise immediately put them in a strong position to secure the mandate. The involvement of key Arbuthnot decision makers in the first meeting demonstrated a real commitment to our company. They were friendly, pragmatic and asked insightful questions about the company, allowing them to structure the financial package adapted to our needs.

He continued: “MDS has increased its annual turnover from £ 15million to £ 25million over the past five years. We have a strong backlog and any further organic growth plans can be supported by Arbuthnot’s revolving credit facility. We are very happy to be working with Arbuthnot and are currently in the process of moving our banking transactions to them as well. “

Andrew Rutherford, Commercial Director at Arbuthnot Commercial ABL, said: “MDS is a growing, established and profitable company with a strong customer base, led by a very experienced management team. This transaction highlights the flexibility of asset-backed loans by providing the capital to support the acquisition of a business by its management team as well as a dynamic offering of ongoing financing that will grow with the sales of the business. We look forward to developing a lasting relationship with the MDS team.

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