Ramsdens strikes gold with unw advice
Pawnbroking firm Ramsdens Financial has secured a “substantial multi million pound” funding facility from HSBC Corporate Banking which will enable it to grow turnover to £50m, create 130 jobs and hit the 100 store milestone by the end of 2012.
The ambitious Middlesbrough-based family firm, which is known for its Got Gold Get Cash strap line, obtained the development facility after advice from Newcastle corporate finance specialist unw prompted it to switch from its former bank to HSBC’s team in Gateshead.
Ramsdens - which is on course to reach £36m of sales with 340 staff employed across 83 pawn broking and jewellery stores by the end of this year - will use the funding package to help it extend its branch network to around 103 shops and its workforce to 470 over the next two-and-a-half years.
unw advised the company on the full range of funding options to help them achieve their growth aspirations.
Ramsdens Financial chief executive Peter Kenyon said: “We did consider a stock market listing or private equity to raise the finance but both routes are currently very expensive. The re-bank means that we have secured a substantial multi million pound development facility and, importantly, that the existing shareholders will continue to have 100% control and can make the decisions regarding the future direction of the company.
“HSBC has not been given any government support and, as a result, we have found them to be much more open minded towards funding businesses.
“We felt that we would be better supported by a bank that did not have problems of its own and unw put us in touch with HSBC and has a good understanding of our business. They understand the personalities and have been able to express their opinions on the company as part of a close working relationship, which has been crucial.
“Yes, they are accountants so provide us with VAT and tax advice and undertake our audit, but the added value has been their commercial thinking around the business.”
Ramsdens is the 183rd largest North East company according to the Journal’s top 200
and its stores are currently located within the Tyne Tees region, Yorkshire, Scotland and Wales. The company will look to infill within these areas, as it opens 15 new stores in 2011 and 15 in 2012, and is still looking at “four to five specific opportunities” in the North East.
unw senior corporate finance manager Zara Lane said: “Ramsdens is one of many of our clients considering raising a mix of equity, development capital and debt. We have a track record in delivering funding solutions that enable management to deliver on their plans. When you have a management team like at Ramsdens and they have an ambitious, yet highly credible, plan it makes our job considerably easier.”
HSBC North East corporate banking centre manager Tony Leech said: “We are delighted to be supporting Ramsdens, a local, family-run business, in its plans to expand further in the UK.
“The past months have seen our own local team working closely with the business and unw to create a flexible package to meet its growth needs. We look forward to developing the relationship as Ramsdens enters this exciting time of expansion.”
Picture caption: left to right: Ramdens finance director Kevin Brown, Ramsdens chairman Stewart Smith, unw corporate finance manager Zara Lane, HSBC North East corporate banking centre manager Tony Leech and HSBC corporate banking manager Andy Blain.
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