Yorkshire green energy firm first to benefit from government's new finance offer
06 April 2018
To enhance its support for UK exports, government agency UK Export Finance (UKEF) has expanded eligibility for government-backed loan and bond support to include the UK supply chain for the first time – support previously only open to UK exporters. Wakefield-based Green’s Power is the first company to benefit from this new finance offer.
Green’s Power has been helping companies reduce their emissions by capturing and reusing waste heat for almost 200 years. From cruise ships to power stations, paper mills and food factories, its customers span over 25 countries, from the USA to Vietnam.
While 60% of its sales are exports, Green’s Power also supplies other UK businesses that then go on to export themselves. For example, in 2015, Green’s Power won a supply contract with a UK energy company, which then exported the supplied component as part of a wider package to Africa.
In order to secure these contracts, Green’s was required to provide a performance guarantee for the benefit of its buyer. However, banks typically require companies to provide cash security prior to issuing a bond, which can restrict the cash a company has available to fund its orders or take new ones on.
A greater capacity for growth in both the UK and overseas
Ensuring UK suppliers to other UK exporters can secure the funds their business needs quickly and easily is a great way to boost both the UK export and domestic economy, by ensuring access to cashflow doesn’t hold back UK businesses’ ability to keep up with demand.
Thanks to the extension of the UK Government’s export finance offer to include the UK supply chain, UKEF, the UK’s export credit agency, was able to provide a guarantee for 80% of the bond’s value to Green’s Power’s bank, HSBC. This allowed HSBC to provide the bond without additional security from Green’s, allowing Green’s to retain valuable working capital to help deliver the contract, and enhance its capacity to finance other orders from the UK and overseas.
Matthew Crewe, Managing Director of Green’s Power said:
“Having worked with UKEF on several export contracts, UKEF has played a significant role in our international growth by giving us the financial resource to seize those overseas opportunities.
"Now this new avenue for support means we have greater capacity to grow our business in the UK too, while supporting UK exports – this is really great news for the UK supply chain.”
Paul Wright, Export Finance Manager for Yorkshire and Humber, UKEF said:
“Green’s is a great example of how UK companies will benefit from UKEF’s new supply-chain trade finance. By extending support beyond the exporter, into the supply chain, we will not only help individual UK companies grow their business, but also make UK exports more competitive on a global scale by making it easier for them to deliver.
“This is just one way UKEF is constantly innovating to provide the best support for UK exports. In addition, Green’s operates in a market where customers often require bank guarantees, and UKEF support in this area is now much more accessible through our partnership with high-street banks, introduced in October 2017, which streamlined the process for both bank and exporter.”
Chris Alsop, Relationship Director HSBC said:
“Green’s Power are a new customer to HSBC and we are delighted to be supporting them with their growth ambitions. For export-led businesses like Green’s, working with UK Export Finance helps us make sure the support we offer our customers is as suitable and as flexible as possible, and UKEF’s new supply chain offer is another valuable addition.”