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Northwest Interim Loan Fund completes first loans

Tuesday 6th April 2010

• £225k in loans issued to two growing companies
• £10m Interim VCLF deals under review with several close to contract

The Northwest Regional Development Agency (NWDA) and the European Regional Development Fund (ERDF) is delighted to announce the first Interim Loan awards just days after the first Interim equity investment was announced.

Just last week the NWDA and ERDF announced the first equity investment of £300k alongside the new structure for the long term Northwest Venture Capital & Loan Fund (VLCF). This week the first Interim Loans have been issued through fund managers AFM, and the NWDA is urging businesses not to wait for the long term Northwest VLCF but to apply now for VCLF funding.

The first Interim Loan of £100k has been awarded to Sovex Ltd. Sovex is one of the UK's leading conveyor manufacturers. The company based in Prenton on the Wirral boasts blue-chip clients including Parcelforce Worldwide, DHL, andToys R Us. The company also has an operation in Gainsborough and in total employs almost 100 people. The company manufactures some of the most significant conveyor technical developments in the UK.

The second Interim Loan of £125k has been made to SHOKK Ltd. SHOKK Ltd is a global company that specialises in physical activity, health and fitness for the youth sector. The company has firmly established itself as the number one youth fitness brand. With over 200 facilities worldwide, more than 175, 000 young people are now involved with the concept.

SHOKK is passionate about increasing the activity levels of young people across the world. Supplying a full range of specialist equipment, training and services the company has a complete offering to suit the needs of young people aged between five and eighteen.

The company, with a Northwest base in Trafford, is growing and are now taking larger enquiries and orders as their reputation increases in the UK and internationally. Plans are also in place to roll out more facilities under the successful SHOKK 'Youth Gym' brand and franchise model. The company requires funding to meet the growing demand and the associated working capital for stock requirements. The Interim Loan will help SHOKK to continue their high growth strategy and long term development plan, with an additional £125k loan under offer with the company.

Robert Hough, Chairman of Northwest Regional Development Agency (NWDA), said:
"I am delighted to be announcing the first loans from the Interim VCLF. These loans will make a huge difference to these companies and will help them to ease cash flow and help them to grow here in the Northwest. We have venture capital, equity and loan funding in place now to help and I would welcome more businesses getting in touch and applying for this support."

The Interim VCLF, managed by YFM and AFM, has received a high level of enquiries.. Businesses interested in VCLF funding should contact Business Link Northwest.

The Interim VCLF currently has 37 applications under active review totalling £10m; of which a number are close to contract stage and more details on these awards will be announced in the coming weeks.

The first equity investment of Interim VCLF was announced last week, to Fresh T, a computer software and service company. Fresh T is looking to develop their business and establish a foothold in the growing Cloud Computing market (Internet-based computing, whereby shared resources, software and information are provided to computers and other devices). An investment of £300k has been issued to the company which will see the company move into the Daresbury Science and Innovation Campus.

The Interim VCLF is a combination of loan, equity and quasi-equity funding to support business growth. Loans range from £50,000 to £250,000 with Equity and Mezzanine finance available up to £1m for initial investments.

It is vital, particularly in challenging trading conditions that we ensure SME's in the region can access the funding required to support investment and growth. The message to businesses in the Northwest is that we have funding available now for growth businesses and VCLF funding is here ready for applications.

Whilst the Northwest VCLF has taken longer than anticipated to deliver it is now in the final stages, with several milestones reached last week including; the appointment of the Chairman, Board, Managing Director and Investment Advisory Panel for Northwest Business Finance Ltd, all now completed.

For more information on Finance for Business please visit: www.nwdabusinessfinance.co.uk

ENDS

Notes to Editors:
The JEREMIE initiative offers EU Member States, through their national or regional Managing Authorities, the opportunity to use part of their European Union (EU) Structural Funds to finance small and medium-sized enterprises (SMEs) by means of equity, loans or guarantees, through a revolving umbrella fund. The initiative was developed by the European Commission (EC) and the European Investment Fund (EIF), which is part of the European Investment Bank (EIB) Group.

JEREMIE provides for a range of debt and equity financial tools to obtain the most appropriate allocation of funds according to national, regional or local requirements.

The regional VCLF is funded by a European Regional Development Fund grant under the 2007-13 programme and is matched equally by private sector loan funding. The Northwest (JEREMIE Fund) will run for an initial investment period up to the end of December 2015.

ERDF: Between 2007 and 2013 the Northwest of England will receive a total of £521million (dependent on exchange rate) from the European Regional Development Fund (ERDF).

Managed by the Northwest Regional Development Agency (NWDA), this funding will enhance the competitiveness of the region's economy by supporting growth in employment and enterprise.

Key targets for the NWOP include:
• Creating 26,700 net additional jobs by 2015
• Generating £1.17bn additional annual GVA by 2015
• Supporting a 25% reduction in addition CO2 emissions generated by the ERDF Programme.

The Northwest Regional Development Agency (NWDA) works to deliver economic success in England's Northwest by building the competitiveness of its businesses, people and places. Utilising our technical expertise and strategic influence, we help the region's 250,000+ businesses to develop and grow, as well as supporting international trade and encouraging inward investment.

For further information please contact Neil Roscoe, Senior Press Officer on 01925 400232 or mobile 07980 713282 or neil.roscoe@nwda.co.uk