COWGILLS SECURES INVESTEC AS FUNDING PARTNER FOR RUSSELL TAYLOR GROUP
Cowgills business finance team has brokered a £5m funding deal with Investec Capital Solutions for Wirral-based specialist technical recruitment company Russell Taylor Group.
Founded in 2005, the Group owns four businesses: Russell Taylor Group, Recruit Right, NMS Recruit and Perpetual Engineering Partnerships, providing technical temporary and permanent recruitment solutions for industries, including construction, engineering, manufacturing, oil, gas and energy sectors. Today, the business employs around 120 staff operating out of seven strategically located offices across the UK and has a combined turnover of c. £35m.
Having sold two further businesses in 2020, the Group's working capital requirement was reduced from a highly complex £25m facility to £5m and Cowgills specialist team was instructed to identify new funding options with a range of lenders.
Ben Russell, Group CEO, said: "Having gone through numerous MBOs and acquisition
s we needed to put in place a new funding arrangement to deliver the next stage of our business ambitions. It was important to us to build a relationship with a funder that could provide a high level of personal service and we tasked Cowgills to identify a new partner and manage the tender process. We ultimately selected Investec who demonstrated that they had both the strength and flexibility to support us as our business grows.
“At the size we are, we could have gone to a high street bank, but Investec is very much relationship-led which was a key deciding factor for us. Their service is driven by the people that make the decisions and they take the time to talk and listen which is really important.”
Explaining why having access to flexible working capital is critical to growth for the recruitment industry Ben continued: "Recruitment businesses are working capital intensive since clients are on 45 and 60 day terms but you're having to pay out temporary workers weekly. So, unless you have very, very deep pockets, having a working capital facility in place is a must. Investec tailored a £5m facility for us, offering a higher prepayment percentage than we have had historically, enabling us to focus on driving rapid growth.”
“At the time we engaged with Investec one of our businesses had come under increasing cash pressure as it didn’t have a pre-existing invoice discounting arrangement in place. Demand increased suddenly and Investec showed great flexibility in taking that business on for 6 weeks to help us handle the pace of growth. We are really pleased that they will now be supporting our business as we move forward with our plans to become a £50m business in the next three years."
Investec’s Sean Thomson added: “We are of course absolutely delighted to be partnering with Ben as he builds out his vision. We recognise that as an experienced in-sector entrepreneur we were backing Ben, and not just his business. Having worked with Cowgills over the years, their input has been invaluable as always, and in this particular case allowed us to develop a relationship with a dynamic and exciting group, where we see a long-standing future partnership.”
Benjamin Day (pictured), director at Cowgills added: “We were very impressed at how quickly Investec turned around this transaction in a competitive situation. They understood the business very well and delivered every step of the way. They demonstrated real flexibility throughout the process, even releasing funds for one of the Group’s companies based on a side-letter before the full suite of legal documentation was in place, ensuring that vital working capital would be available to deploy immediately which is a great example of modern relationship banking in practice.”