Oaknorth completes £10m debt finance deal
OakNorth – the bank for entrepreneurs, by entrepreneurs – has completed a debt finance deal of £10m for RM Secured Direct Lending PLC (“RMDL”), a closed-ended investment trust which specialises in secured debt for businesses.
RMDL is a closed-end investment trust listed on the London Stock Exchange, which aims to generate attractive and regular dividends through secured loans to businesses sourced or originated by the Investment Manager, RM Capital. These loans are predominantly secured against assets such as real estate or plant and machinery, or income streams. Since listing in December 2016, RMDL has invested in 21 Loans across 11 sectors, including healthcare, energy, property, hospitality and leisure. In October 2017, RMDL raised an additional £30m which will also be used to continue to build its portfolio of investments. The average yield on its investments is 8.26% with an average life of 3.74 years.
RMDL has previously partnered with OakNorth on two joint loans to finance the development of a luxury hotel in central London, L’Oscar and to Strawberry Star for the purchase and development of a mixed-use site in Wandsworth.
James Robson, Chief Executive Officer at RM Capital Markets, added:
“We chose OakNorth because, having worked with them with on two previous transactions, they understood our business and our needs and were able to provide a flexible and competitive offer to meet them, in the timescale required. We share a similar set of values and they also have an excellent understanding of the complex SME lending market and the unique needs of mid-market companies that we invest in. We look forward to deploying these funds into quality businesses.”
In a joint statement, Ben Barbanel, pictured, Head of Debt Finance, and Mohith Sondhi, Debt Finance Director at OakNorth, commented:
“We are very excited to have completed this transaction with RM Secured Direct Lending – not only is this our first transaction with a listed company, but it is also our first loan to an investment trust. Our Credit Committee was reassured by the extensive experience of the management team – over 120 years collectively – as well as the RMDL’s strong track record and diversified portfolio. Given that we have worked with RMDL on two transactions in the past, we also had a good understanding of how they operate. The transaction also demonstrates OakNorth’s unique way of doing business in a clear and transparent way which applies to all types of borrowers from our core SME clients but also PLCs.”