Bath-based specialist lending group 1pm has hit the acquisition trail again – snapping up an independent funder of hard assets as it continues its fast-paced growth.
1pm is paying £2.3m for Warwickshire-based Bell Finance, which has been lending to firms in the construction and manufacturing sectors mainly against business-critical equipment such as plant, machinery and vehicles since its launch in 2000. 
Bell, which also provides ‘Caterham’-branded finance for kit cars, originates around £6m of new business a year – most of which it funds on its own balance sheet, with approximately 15% of deals brokered-on.
Its current loan book has more than 400 live agreements amounting to £10.3m of receivables, including £2.3m of future revenue.
The firm made pre-tax profits of £400,000 on revenue of £1.7m in the year to November 30 and has net assets of £1.1m.
1pm said it would merge Bell’s operations into those of its existing subsidiary Bradgate Business Finance, which it acquired in March last year.
Bell and Bradgate are both specialist providers of hard asset finance to a broad range of largely owner-managed businesses. 1pm said their core strength was access to a selected panel of funders while also having the ability to act as a principal funder.
1pm said the Bell takeover met its two core strategic objectives of building scale and replicating the funding and broking model which it successfully operates in its asset finance division.
1pm CEO Ian Smith said: “We are delighted to build on the recently announced acquisition in our loans division, by completing this acquisition for our asset finance division.
“This latest transaction demonstrates our ongoing commitment to delivering on our strategic objectives of building scale and maintaining our funding and broking capabilities. The acquisition of Bell and its merger into Bradgate creates a substantial business for the funding of hard assets required by many SME sectors and establishes a platform for further growth.”
Bell directors and principal shareholders Richard Batchelor and Mark Durman have agreed to stay with the group and work in conjunction with Bradgate directors Richard Arnold and Ian Sullivan.
The merged business will operate under the Bradgate name from Bradgate’s office in Lutterworth, Leicestershire.
The £2.3m cash payment for Bell includes £300,000 to be placed in escrow for up to six months and released on achievement of certain integration milestones. The deal also includes a further £300,000 of deferred cash over three years and an earn-out of £800,000.
1pm has financed the cash part of the payment from its existing borrowing facilities.
