Arbuthnot Commercial ABL structures comprehensive funding package to support Strathray Capital Partners' investment into Pinnacle

Arbuthnot Commercial Asset Based Lending (ACABL) has completed the financing of Pinnacle UK Group Limited (Pinnacle), a regional electrical wholesaler and distributor. The flexible funding facility has supported private investment firm Strathray Capital Partners in acquiring a controlling stake in the business while leaving sufficient headroom for further growth. The comprehensive structured finance package comprised a revolving receivables line, a cashflow loan, and an RLS term loan.

Pinnacle was founded in 2011 as a traditional electrical wholesaler. The business operates from two locations, Bolton and Birkenhead. It subsequently developed a third division, Plumbing & Heating Supplies, to broaden its offering and customer base. Having built the business since its formation, the two founders were looking to realise some value but wanted to stay involved with an equity interest, which this transaction allows.

Commenting on the transaction, Vernon Goldberg, Partner, Strathray Capital Partners, said:

“In line with our partnership capital approach, we were looking to develop an ongoing business relationship with a like-minded team that shares our values and risk outlook. We spoke with several banks, providing them with an understanding of our ambitions and how we like to work. The team at Arbuthnot Commercial ABL was both perceptive and pragmatic in structuring the transaction in a way that would give us maximum comfort. They put forward a proposal that provides the optimal level of headroom over the first couple of years and demonstrated additional flexibility in the way the facility was deployed. Arbuthnot Commercial ABL has deep experience in completing deals like this and they were as good as their word, delivering the transaction extremely smoothly."

He continued:

"Our ambition for Pinnacle is to create a regional powerhouse in electrical distribution, doubling the number of branches in the North West in the next two to three years. The owners have done extraordinarily well over the last ten years and have built a strong business. The deal we have struck has enabled the founders to take some money off the table. But in all other respects, they will continue to run the business as they have done before and are excited to go on and drive the planned expansion."

Andrew Rutherford, Commercial Director at Arbuthnot Commercial ABL, said:

“We are delighted to have supported Strathray Capital Partners with this transaction. This deal relied on a combination of factors that speak directly to our approach across all M&A deals; the combined focus on gaining a deep understanding of the requirements of both the investor and the business, speed of delivery, and the ability to maximise the quantum of funding available to achieve the next level of growth.”

Arbuthnot Commercial Asset Based Lending Limited is a specialist asset-based lender, focused on delivering facilities to SMEs and lower mid-market corporates.

The specialist lender provides full asset-based lending (ABL) facilities (invoice discounting, stock finance, property and plant and machinery loans) plus cash flow loans in support of acquisition, refinancing, cash-out, and turnaround scenarios.

Its clients benefit directly from the commerciality, commitment, and creativity of an independent bank, aligned with the strength, stability, and heritage of the Arbuthnot brand.

Arbuthnot Commercial Asset Based Lending Ltd. is a wholly owned subsidiary of Arbuthnot Latham & Co., Ltd.

Arbuthnot Latham & Co., Limited, established in 1833, is the London-based private and commercial bank, also specialising in wealth management. With regional offices in Manchester, Bristol and Exeter, Arbuthnot Latham & Co., Limited is owned by Arbuthnot Banking Group PLC.

Business Enquiries:ABL@arbuthnot.co.uk

Gatwick Office: The Beehive, City Place, Gatwick, RH6 0PA

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.

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