Investec Growth & Acquisition Finance, a subsidiary of LSE-listed Investec Bank, has provided £5.5 million (€6.9 million; $9.3 million) of senior debt facilities to support the refinancing of Imagesound, a supplier of music solutions to businesses, according to a statement.
The financing will also support the future growth strategy of Imagesound, which is a portfolio company of London-based private equity firm Vespa Capital.
It is the second time Investec has supported the company, after making a minority equity investment in January 2012 and arranging debt for the company from Co-operative Bank at the time, Investec Bank's Ed Cottrell told Private Debt Investor. “Having worked very closely with the firm before, we were ideally placed to arrange a replacement debt facility,” Cottrell said.
The debt package refinances previous debt and advances the appropriate debt for the company over the next few years, he said. There is also a “very small revolver attached,” he added.
Investec is now invested in both the debt and equity part of the business. “It’s the hallmark of what we do. We are prepared to finance across the capital structure,” Cottrell said.
The deal is the latest financing solution the arm of Investec’s specialist banking unit has closed in a month, after supporting the £85 million acquisition of Maplin, a UK electronics specialist retail chain, by private equity firm Rutland Partners in June.
After well-publicised problems with profitability at Maplin, Investec was able to put together financing which combined receivables financing, invoice financing and structured cash flow lending, Cottrell said. “We managed to put together a financing package which a traditional high street bank would have struggled with,” he said.
This along with a good management team and what Cottrell believes is the rock bottom in terms of the firm's profitability means that the company is now a “good prospect,” he said.