A £3.25m revolving receivables facility has enabled Colway Limited to sever its ties with failed Icelandic bank Kaupthing and concentrate on moving the business forward.
Founded in 1973, Colway Limited is the holding company for a number of print services, and art and office furniture supply brands, including RED BOX, London Graphic Centre, and Turning Point. The company sought funding from Kaupthing in 2006 for a management buy-out but the bank was put into administration just two years later, as a result of the Icelandic banking crisis.
In order for the company to expand and diversify, Colway Limited needed to remove itself from the restrictions of Kaupthing and work towards a more flexible funding option. “Dealing with a bank in administration created many challenges. Terminating this relationship involved many complexities that are not usually apparent in normal funding situations,” says Gordon Christiansen, CEO of Colway Limited.
The deal was secured through the specialist Structured Finance Division of ABN AMRO Commercial Finance, and incorporated a £700k cash flow loan, which enabled the company to refinance legacy debt from Kaupthing. Patrick Wilkins, Structured Finance Sales Director at ABN AMRO Commercial Finance says, “Taking a flexible approach, we were able to redefine that debt at a discount and allow Colway to finally move forwards and look towards the future.”
Colway will be using its funding to expand and diversify its sub-brands into new product areas such as 3D printing, digital asset management software and fast, large-format printing.