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LOAN TO ECOMERCHANT NATURAL BUILDING MATERIALS LTD
Capital for Colleagues, the ISDX-quoted investment vehicle focused on opportunities in the Employee Owned Business sector, has announced that is has invested £75,000 in Ecomerchant Natural Building Materials Ltd, a specialist supplier of natural and environmentally sustainable building materials to the UK housing market, through a convertible loan with a 15% coupon.
Overview:
* Loan of £75,000 to Ecomerchant represents Capital for Colleagues’ seventh investment and fourth since floating on the ISDX Growth Market in March 2014
* Investment underpins the Company’s strategy of becoming a leading entity within the growing EOB sector
* Following completion of the loan, an Employee Benefit Trust will be established as a 25% shareholder in Ecomerchant
* The proceeds of the loan will be used by Ecomerchant for general working capital purposes and to drive organic growth
* The loan is secured on the assets of Ecomerchant for a fixed term of 12 months and bears interest at the rate of 15% per annum
* Capital for Colleagues has the option to convert the loan on or before its due date into participating preference equity in Ecomerchant
* The Company maintains an active growth strategy and will continue to seek investments which show a commitment to employee ownership with the ability to generate value
John Eckersley, Chief Executive of Capital for Colleagues said, “As with all of our investments, UK focused Ecomerchant is committed to employee ownership and has excellent growth prospects, which underpin the value of our investment. With the option to convert the loan into an equity stake in Ecomerchant, Capital for Colleagues will support Ecomerchant’s development. Following this loan of £75,000, we now have an established portfolio of seven highly prospective investments, and we look forward to continuing our fast paced growth strategy to maintain our first mover advantage in the EOB sector.”
“The loan to Ecomerchant is further evidence of the Company’s commitment to structuring investments which are mutually beneficial to both the investee company and to Capital for Colleagues. Ecomerchant receives the capital it needs and gets access to the benefits and opportunities associated with employee ownership, utilising Capital for Colleagues proven knowledge and experience within the sector. In return, Capital for Colleagues has secured an attractive return on its funds and the option of equity participation in abusiness which the Company’s Directors believe has excellent prospects.”
