The deal, which allies the considerable investment capital of the Rothschild Group with the expertise and relationships of Print Finance, could mark a new dawn in the supply of vital credit to SME print businesses.
Sam Geneen, managing director of Five Arrows, said: "The print sector requires financial support to invest in new equipment and this is not being delivered by the banks.
"The understanding that [Print Finance] has of the sector, coupled with our resources will bring more competition into the market, which can only be a good thing for printers seeking finance."
According to Paul Coggins, founder and managing director of Print Finance, the firm will continue to provide direct and brokered finance to the sector but will be "unrestricted in its ability to lend to the right business".
He added that the decision to sell was entirely based on the market need for a specialist funder, with a deep understanding of the industry, to provide finance at mid-market rates – between those of the banks and the sub-prime lenders.
"That’s the whole point of doing this," he said. "To position ourselves in the middle ground and be able to support the guy who doesn’t want to pay a double-digit rate but can’t get the high street to back him – that’s a massive part of the industry."
According to one finance broker, there hasn’t been a mid-market lender since 2007 or earlier, meaning that SME printers have been starved of affordable credit.
Coggins said: "It’s the responsibility of manufacturers and finance providers to be positive about the industry and to provide the solutions that will allow investment.
"The banks will return but that could be a long time away and we need to support printers now, when their balance sheets might be a bit weaker, but the business is fundamentally sound – it’s the rationale for the investment we’ll be looking at, not just the balance sheet."
THE PLAYERS
Five Arrows Leasing
Founded: 1988
MD: Sam Geneen
Services: asset-based finance provider
Print Finance
Founded: 1990
MD: Paul Coggins
Services: specialist lessor and broker for print industry
