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(ISDX:CFCP)
Capital for Colleagues, the ISDX-quoted investment vehicle focused on opportunities in the Employee Owned Business sector, has announced that is has made its fifth investment through a convertible loan of £100,000 to Midland Construction Supplies Limited, a UK based company with a ten year track record in the supply of accessories for the construction industry.
This is Capital for Colleagues’ second transaction since the Company floated on the ISDX Growth Market and raised £2.19 million in March 2014.
The proceeds of the loan will enable MCSL to respond to an identified increase in demand for its products and services and for working capital purposes. The loan is for a fixed term of 12 months and bears interest at the rate of 15% per annum. At the end of the 12 month term, the loan notes will either be redeemed in full or converted into preference shares in MCSL, at Capital for Colleagues’ option.
In tandem with the transaction MCSL is currently reorganising its capital structure and has committed to allocate 20% of its new share capital to an employee benefit trust.
Capital for Colleagues is focused on structuring its transactions so that they are of mutual benefit to both the investee company and Capital for Colleagues. Investee companies not only gain access to the capital they need but also to the benefits and opportunities associated with employee ownership.
Capital for Colleagues CEO John Eckersley said, “Midland Construction Supplies represents another strong investment case, meeting our stringent criteria and strategy for growth. This is our fifth investment, the second since listing and raising £2.19 million less than a month ago, and further underscores our determination to leverage our cash position to build a leading position within the employee ownership sector. This is a very exciting time for the Company.”
