Land Energy (LE) secures £6 million funding from Independent Growth Finance (IGF) to expand operations and create a new sustainable heating product line. Land Energy secures £6m in funding.
The asset business lending (ABL) package includes invoice finance, inventory and equipment facilities.The significant working capital will enable us to expand our operation to develop a new, clean-burning briquette aimed at the domestic solid fuel market.
Land Energy’s initial focus was on biomass energy sources to create a viable wood pellet manufacturing base. Over the past 15 years, we have become one of the largest wood pellet manufacturers in the UK and we now supply both the commercial and domestic markets under our various brands, focussing on de-carbonising the heat market.
Sustainability is at the heart of our ethos and influences all aspects of the company’s operations. As a result, we have been awarded the UNESCO Galloway and Southern Ayrshire Biosphere certification mark – and we are sustainable leaders within our industry.
Our products are made entirely from sustainable local sources, and we focus on markets that can make a real difference in helping to reduce the UK’s carbon footprint. LE supplies many hospitals and care homes across the UK, which use our wood pellets for heating and hot water. We also provide domestic users.
Increasing demand for sustainable heating fuel solutions drives growth
The UK Government’s ban on the use of coal and unseasoned firewood in domestic settings, under the Clean Air Strategy, has meant increasing demand for sustainable sources of heating fuel.
We have identified an opportunity to grow our business by adding a new biomass briquette production line to complement our wood pellet production.
To realise its expansion plans, LE needed additional working capital. Discussions with mainstream lenders proved unsatisfactory as the inflexibility of their funding models was restricted. We needed a partner who was prepared to take an independent view and be flexible in providing funding to reflect the seasonal nature of their markets.
Finding the right finance partner
Via their shareholder, BRG Asset Management, LE entered discussions with IGF, and as a result, rapid and flexible financing options were identified. John Westmacott, Managing Director of Land Energy, commented:
“It was clear to us from the outset that IGF understood our business and was able to develop appropriate financing solutions. This gives us access to capital which enables us to fund expenditure on the new plant. Importantly, this financing will ensure the plant becomes revenue-generating in the shortest possible time. We view this initial finance facility as the first stage in our relationship with IGF, and we look forward to working with them as our business continues to grow.” Jon Hughes, Director at IGF, commented:
“We are excited to partner Land Energy, helping it to grow an important and sustainable business that will have a positive impact on the UK’s carbon footprint. IGF took the time to understand LE’s business requirements and put in place a flexible funding package. We are very much looking forward to a long-working relationship, based on the company’s needs.”
Land Energy’s new briquettes will roll off the production line in early 2022.