Compass flags window of opportunity for M&A finance

Wednesday, March 24, 2021

Compass Business Finance has flagged the looming deadline for “favourable” M&A financing using the government-backed CBILS scheme – but printers need to act fast to put things in place.

Bunker: “This is certainly a moment in time"
Bunker: “This is certainly a moment in time"

The Kent-based finance specialist said there was “a unique window of opportunity” to register an application before the end of this month.

Director David Bunker said: “Access to finance for M&As is very attractive with low interest rates and the ability of banks, along with non-bank lenders, to provide CBILS as well as other favourable funding structures. 

“This is certainly a moment in time.”

The firm said that the Covid-19 situation had accelerated some plans around M&A activity, with drivers including the consolidation opportunities that have resulted from the effects of the pandemic. 

Compass has worked on the finance for a number of industry M&A deals, most recently the high-profile acquisition of John Dollin Printing Services by Anthony Thirlby and Andy Rae, via their new buy-and-build venture Venn Holdings.

Compass explained that companies with a target in mind, or that wished to consider a target opportunity, can register a CBILS application before the end of March. “We then have until the end of May to approve these deals,” Compass explained. 

Once the funding has been approved, the deal has further time to complete. 

“Depending on the structure used, these deals could take place as late as November 2021 and still receive the interest free period taking the low repayment period potentially all the way through to October 2022,” Compass stated.

As of 21 February, The British Business Bank had approved loans amounting to more than £74bn, with some 2,098,741 businesses taking up the financing deals. 

After the CBILS and CLBILS finance options conclude at the end of the month, the new Recovery Loan Scheme announced in the budget will launch. 

It goes live on 6 April and is set to run until the end of the year. 

 

 

 

 

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