Anexo Group plc (LON: ANX), the specialist integrated credit hire and legal services provider, has announced increased debt facilities following discussions with its two major lenders to fund growth in its credit hire and legal services divisions. In total these facilities will provide additional financing of £16.0 million across the year.
Credit Hire Division
Direct Accident Management Limited (DAMS) and Professional and Legal Services Limited (PALS), both subsidiaries of EDGE, the Group’s credit hire division, use an invoice discounting facility provided by Secure Trust Bank Plc (Secure Trust) which is secured on the respective trade receivables of each company. The Board is pleased to announce that the funding under these agreements is being increased immediately from £18.5 million to £25.0 million, split between £17.0 million as a Credit Hire facility, £6.5 million as a Credit Repair facility and £1.5 million to support growth within PALS. This initial increase will be followed by three quarterly increases of £2.5 million, taking the overall facility to £32.5 million. The overall facility limit will be £36.5 million. The minimum period for the agreement has been extended to 31 December 2022. Interest on the Credit Hire and Credit Repair facilities is charged at 3.75% above base rate; interest on the PALS facility is charged at 2.75% above base rate.
In July 2020 Direct Accident Management Limited secured a £5.0 million loan facility from Secure Trust Bank Plc, under the Government’s CLBILS scheme. The loan was secured on a repayment basis over the three year period, with a three month capital repayment holiday, £2.0 million of which was to be paid as a final instalment. Interest is payable at the CLBIL Scheme Interest Rate. The facility is provided alongside the newly agreed facilities, with the final instalment now being amortised over the remaining life of the facility.
Legal Services Division
Bond Turner Limited, the Group’s legal services division, operates with a revolving credit facility provided by HSBC Bank Plc (HSBC). The Group has received approval from HSBC for an immediate increase in this facility from £8.0 million to £10.0 million, committed for a period of three years with interest payable at SONIA rates. The Group expects to finalise the arrangement shortly.
In July 2020 Anexo Group Plc secured a loan of £2.1m from a specialist litigation funder to support the investment in marketing costs associated with the VW Emissions Class Action. The terms of the loan are that interest accrues at the rate of 10% per annum, with maturity at the earlier of settlement of the claim and receipt of the proceeds or three years from the date of receipt of funding. In addition to the interest charges the loan attracts a share of the proceeds to be determined by reference to the level of fees generated for the Group. The terms of this arrangement remain unchanged.
Alan Sellers, Executive Chairman of Anexo Group, said: “We are delighted to have agreed new terms with our two longstanding finance providers. The agreements underline the strength of our relationships with our lenders and their confidence in our business model and growth aspirations. The new facilities will enable us to broaden our dual strategies of raising the number of vehicles on the road, while investing in legal staff and infrastructure to increase the level of cash collections. The Board believes that its policy of concentrating on growth will offer new opportunities for the Group and create long-term value for all our shareholders.”