Crédit Agricole Commercial Finance Supplies Vital Funding

The Vital Services Group was founded in Manchester in 1983. Initially a design consultancy and a professional and technical recruitment business, the group has evolved to encompass personnel contracting businesses across many industry sectors, including Rail, Civils, Construction and Power and Technology. It now has a turnover of £80 million and Vital Rail has become one of the largest suppliers of rail associated services and labour to Network Rail and London Underground.   
 
Vital needed to refinance when their bank was wound down by the Irish Government. They appointed PKF LLP to assist them in finding a new lender to both fund their working capital and to help grow the business in certain markets. Having considered the options, PKF drew up a shortlist of three serious contenders.
 
Vital's Finance Director, Rob Johnson, explained why Crédit Agricole Commercial Finance quickly emerged as the front runners: "Crédit Agricole's team was very keen to do the deal and showed a good understanding of our business. They were friendly, open and honest and listened to us. They were also clearly interested in a long term partnership, which was a very important consideration."
 
In spite of complications arising from an inter-creditor agreement, Crédit Agricole Commercial Finance structured and delivered a £20,900,000 Confidential Invoice Discounting deal.
 
Jason Hiley, a Partner at PKF commented: "Credit Agricole worked hard to understand Vital Services Group's business and tailored a package which dovetails with the Group's business process. The approach taken to progressing the deal was well received by management and allowed Crédit Agricole to form a strong working relationship with the board, providing a co-operative approach to overcome issues arising in the course of the refinancing. The structure of the new funding line should allow the business to take advantage of strengthening conditions in its core markets and is evidence that, despite difficult economic conditions, there are still good funding partners willing to finance the development and growth of companies with the right business plan."
 
Mr Johnson concluded: "Crédit Agricole Commercial Finance have rationalised and stabilised the cash flow of the business enabling us to take advantage of the strengthening conditions in our core markets.

"It is an exciting time as the deal will enable us to grow in 2011 and beyond, with the support of a funder who understands our business and who has a willingness to commit the additional working capital. This will allow us to expand our core businesses and provide enhanced levels of service to our customers."