Insulation and fire protection expert Aran Services has secured £1.5 million in working capital from Independent Growth Finance (IGF). The funds, which were raised using invoice discounting, were used to support the recent MBO and to provide working capital to support the continued growth of the business.
Founded in 2004, the Suffolk-based company specializes in domestic and commercial energy efficiency and fire safety, working with schools, social landlords, local authorities, utility providers and home owners, to ensure their systems are up to scratch.
Upgrading older buildings to modern standards
Aran Services proudly serve the most vulnerable in society, with their innovations lowering the cost of bills, reducing carbon emissions and improving the standards of up to 350,000 business and homes.
However, in light of the current pandemic the company has had to adapt the sectors it focuses on. Work in domestic homes has dropped off steeply, due to the need for social distancing. At the same time, its work with the NHS has seen an upturn, as the business helps the service upgrade older buildings to modern standards to treat an influx of patients.
It is also proving a good time to complete work on schools and other local authority properties, which are usually full of people. It’s not just coronavirus that has enforced change. New regulations on landlords to maintain standards throughout the course of a tenancy will drive more demand in this area as the market responds.
Funding to be used for insulation and fire protection
After their incumbent bank failed to deliver the funding required for the MBO, Aran Services was referred to IGF by corporate finance advisors Ensors. From the outset IGF took the time to understand the business and its funding requirements and, shortly after the initial meeting with the MBO team, approved the facilities as proposed.
IGF’s funding was made available within the timescale set out by the management team, enabling them to complete the MBO and focus on delivering the next phase of growth for the business.
Aran Services and IGF partnership
On track for one of their better years, they have added over 40% on the previous year’s profit
Mark Randall, Group Managing Director at Aran Services, reflected on the company’s experience working with IGF: “From the outset IGF has been a breath of fresh air – friendly, open and approachable. The team has worked with us to understand the mechanics of our business and our cash-centric business model."
"We really appreciated such a customer-focused approach, and with IGF also being an SME, we felt very comfortable aligning with them. The feeling was mutual – we’re a low risk and easy deal – and so the partnership was formed. We’re very much looking forward to continuing working with them in future.”
Current pandemic impacts shorter term plans
Since receiving funding, Aran Services has already seen some promising results. On track for one of their better years, they have added over 40% on the previous year’s profit, and their last quarter was their biggest in the company’s history.
Such data reflects the progressive ambitions of the new owners, who hope to use IGF’s funding to maintain their growth trajectory. While the current pandemic will impact these plans in the shorter term, the company is confident about the future.
Jeff Greenfield, ABL Director at IGF, discusses Aran Services’ future: “We’re excited to be working with Aran Services. Their recent progression is impressive, and their business model is solid. We were pleased to be able to offer support when Aran Services’ previous lender fell through and we look forward to being a part of their future success.”