Arbuthnot Commercial ABL supports Newcastle Tool & Gauge with ‘bolt-on’ acquisition of ABS Precision

By Bridging Loan Directory 20th July 2022

Arbuthnot Commercial Asset Based Lending (ACABL) has structured and delivered £3.2m of new accounts receivable and cashflow lending to support Newcastle Tool & Gauge’s (NTG) acquisition of specialist engineering business, ABS Precision Ltd (ABS).

ACABL has financed NTG since the company’s Management Buy-Out (MBO) in December 2020. Both deals were sponsor-led by private equity firm, Ignite Growth LLP, which is a majority shareholder of NTG.

The funding from ACABL not only provided the additional capital to enable the acquisition but also generated additional funding for the fit-out of NTG’s new purpose-built 45,000 square-foot factory in Gateshead, as a key part of its scale-up strategy.

Established in 2004, ABS utilises state-of-the-art CNC machine tools at a 20,000-square-foot facility in Longbenton and employs 45 highly skilled and experienced staff.

The acquisition by NTG will support ABS in growing its market presence in specialist industries, including hydraulic bolting, electric vehicle, and general precision engineering applications.

Commenting on the acquisition, Forbes Stuart, Partner at Ignite Growth, said:

“We have developed a good relationship with Arbuthnot Commercial ABL.

Their team is commercial and accessible, and their ability to deliver deals smoothly plays an important part in the acquisition process, particularly when juggling other elements such as banks and due diligence.

As a result of the transaction, ABS will bring complementary and expanded capabilities that will present mutual growth opportunities for the group.

We look forward to working with Arbuthnot Commercial ABL on future acquisitions.”

Andrew Rutherford, Commercial Director at Arbuthnot Commercial ABL, said:

“This acquisition is an important step forward in NTG’s ambitious plans for growth and underlines the ability of ABL-funded buy-and-build programmes to support clients in driving scale at an accelerated rate.

The transaction also serves to highlight the strength and depth of engineering expertise in the North East of England as a vital industrial and economic hub.”