Arbuthnot Commercial ABL provides a unique capital structure to support the growth aspirations of Kent Pharma UK
Arbuthnot Commercial Asset Based Lending (ACABL) has delivered a complex, highly tailored super-senior asset-based lending facility for Kent Pharma UK Limited
Arbuthnot Commercial Asset Based Lending (ACABL) has delivered a complex, highly tailored super-senior asset-based lending facility allowing Kent Pharma UK Limited to drive further growth, as demand for branded generic and specialist medicines ramps up post-pandemic.
ACABL worked collaboratively with Duke Street LLP, a leading European private equity group which owns Kent Pharma UK, and an independent private debt fund to create the optimum level of funding for the business. The result of these technical discussions was a bespoke inter-creditor arrangement designed to meet the aims of all stakeholders. This combined the requirements of a unitranche lender, whose capital is typically deployed alongside a super senior revolving credit facility, with the collateral monitoring associated with an asset-based lending facility.
Established in 1986, Kent Pharma is a leading sales and marketing distributor of branded generic and specialist medicines both within the UK and internationally, selling its products primarily to the hospital and pharmaceutical wholesaler channels. Its portfolio of products is diversified across multiple therapeutic areas, with particular strengths in analgesics, anti-infectives, and penicillins. Kent’s portfolio contains many niche, value-added products which are complex to manufacture.
Ivan Greenwood, Investment Executive, Duke Street, said:
"Arbuthnot Commercial ABL demonstrated a real enthusiasm for the business and an appetite to do the deal. Arbuthnot’s team came through on all fronts. They ensured the proactivity and pace to keep the transaction moving forward with intensity and the pragmatism and creativity to meet our aim of securing more capital for the growth of the business, allowing further reinvestment in new product development. This complex transaction was a win-win for all parties involved. There are a lot of businesses out there with a senior unitranche position and an RCF that still need more capital to grow. I am pleased that this structure has set something of a precedent that Arbuthnot Commercial ABL can take forward to other private equity-sponsored situations"
Andrew Rutherford, Commercial Director at Arbuthnot Commercial Asset Based Lending, said:
"We were thrilled to have the opportunity to work closely with some very talented stakeholders, including Duke Street, the management team and the unitranche provider, on the structuring and execution of this highly complex transaction. The facility will enable Kent Pharma to continue its focussed and compelling growth strategy and meet the needs of a substantial, growing, and non-cyclical market. While the focus of the business itself is generics, our solution was anything but. We thoroughly enjoyed the technical challenges involved in this deal, particularly the inter-creditor principles which we can now look to apply to similar private equity-backed scenarios."
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Registered in England and Wales no. 10915339. Arbuthnot Commercial Asset Based Lending Limited’s registered office is Arbuthnot House, 7 Wilson Street, London, EC2M 2SN. Arbuthnot Commercial Asset Based Lending is not authorised and regulated by the Financial Conduct Authority.