British Business Investments (BBI) has increased its commitment to Beechbrook Capital with a new £20m separately managed account (SMA).
The SMA will co-invest alongside Beechbrook’s existing, and future, UK-focused funds. The funds support small- and medium-sized businesses with turnover of between £10m and £100m, and an EBITDA of £1m and above.
They provide predominantly senior secured loans to private, non-sponsored companies to support acquisitions, buy-outs, shareholder re-alignments, re-financings, and general expansion plans.
Beechbrook has built a longstanding partnership with BBI and this is the sixth fund managed by Beechbrook that BBI has invested in. The additional commitment comes as the two firms celebrate their tenth year of working together, after an initial investment in 2014.
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BBI is a wholly owned commercial subsidiary of the British Business Bank and aims to improve access to alternative finance for smaller businesses across the UK, while supporting the transition to a net zero economy.
Since it was established in 2014, BBI has committed more than £3.8bn to providers of finance to UK smaller businesses.
Leveraging BBI’s support, Beechbrook continues to provide essential financial capital to the underserved smaller business segment of the lower mid-market. Since 2008, Beechbrook has invested more than £0.5bn in 70 companies across the UK.
Beechbrook currently maintains a local presence in four major UK cities: London, Manchester, Birmingham and Leeds, and is considering other locations for expansion.
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Beechbrook is currently investing the third fund in the strategy and has recently completed its ninth transaction in Give Me Cosmetics, based in Liverpool, and its tenth in Embrace Steel Group which has operations in North Yorkshire and South Wales.
“We are delighted to advance our relationship with British Business Investments through the provision of this tailored managed account,” managing partner at Beechbrook Paul Shea said.
“We are committed to investing in the UK lower mid-market, supporting growth, jobs and the Levelling Up agenda. We have a busy pipeline and are looking forward to supporting more high-quality management teams to achieve their strategic goals.”
BBI managing director Adam Kelly added: “This commitment to Beechbrook will further support UK smaller businesses with the finance they need to grow. British Business Investments has previously backed Beechbrook’s earlier SME Credit funds with commitments in 2017, 2019 and 2021, and we are pleased to continue our partnership.”
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