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SYIF doubles up on loans to Small business

Published: 27th April 2004

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Investment Manager Andrew Chaffer with Geoff Berry, Managing Director of Specialist IT Services, Rotherham.

South Yorkshire Investment Fund has recently approved second loans for three small businesses in the area who have already received loans - re-affirming SYIF's long term commitment to the region.

Specialist IT Services Ltd, based in Rotherham has just been awarded a £25,000 loan. They first took out a £35,000 with the Fund in October 2002 for business development and the recruitment of additional staff.

Providing IT solutions to businesses and offering a range of bespoke software applications their clients include Sheffield Hallam University and Liverpool City Council.

The new loan is to further enhance the business and expand its services to businesses.

Managing director, Geoff Berry, said: "We are a small company - and it follows that we have found it difficult to expand. Our industry has had very difficult trading conditions and it has been difficult to get support from traditional lenders.

"Our business requires us to invest capital in people rather than assets and this adds to our difficulty in raising money. SYIF has supported us and has been key to our continued success."

Another company to impress us was Swallownest Engineering Ltd of Rotherham. It has again won the support of SYIF with an additional £50,000 loan. Their first loan of £50,000 was approved in March 2003.

The business, which incorporates sister company Supergears Ltd, specialises in providing support to local industry by supplying a wide range of precision machined components which are used in the manufacturers own production process.

Now employing 35 staff and run by directors Mike Smith, Steve Sample and Ian McCrossan, the company will use the additional loan to expand and develop the business further.

Mr Smith said: "Our sales have continued to grow and we needed the extra investment to finance our continued expansion. The Fund has been extremely helpful and their personnel are always very approachable. Investment Manager Allan Wood knows our company and shares our confidence in the business plan."

And Doncaster computer business C&C Computer Marketing has just received a new £22,000 loan. Its first loan of £32,000 in April last year was used to buy new premises - a former ambulance station - which has been refurbished.

Formed in 1992 by Paul and Michelle Carolan, the business employs five people and deals with the recovery, remanufacture, refurbishment and re-sale of computer equipment. The new loan is being used to help facilitate the company's move into the Education market.

Mr Carolan said: "SYIF has shown confidence in our business plan by providing further assistance. The extra funding will help develop and expand our business."

Investment Manager Allan Wood said: "When we invest in a business we commit ourselves to know both the personnel and the business plan. It is something we take very seriously as we believe in building long term relationships with our clients.

"It is because of this commitment that we listen to businesses who have already taken out loans with us. The following firms wanted to move their businesses forward and needed extra cash to achieve their full potential."

The Fund provides loans and equity investments ranging from £15k to £2.5m to businesses in, or prepared to relocate to, South Yorkshire. The Fund has already invested over £6.6 million in 86 businesses.

It offers two key products, one of which is loans ranging from £15k to £150k with effective annual interest rates from as little as 2.4% per annum. Loans are unsecured for the majority of established profitable businesses with unsecured loans of up to £50k available for start-ups or early stage businesses.

The second product is an equity-linked package of a loan with equity options or equity investment, ranging from £50k to £2.5m where the Fund may take a minority shareholding in the business.

A unique feature of the way the Fund can help businesses is the Mentorbank project, which provides subsidised mentoring support to help management teams grow their business more profitably. South Yorkshire Investment Fund also run Capital Network a Business Angels introductory service for early stage businesses in South Yorkshire.

Editor's Notes

About South Yorkshire Investment Fund

South Yorkshire Investment Fund  provided seedcorn, loan and equity linked investments, ranging from £15k to £2.5m, specifically to help small and medium businesses meet the gaps in funding they need for growth and development.

Created as part of the Objective 1 programme, the Fund is a private and public sector business finance provider. The European Regional Development Fund and Yorkshire Forward are investors in the Fund.

South Yorkshire Investment Fund also provided access to Business Angel investments from the Yorkshire Association of Business Angels and Microloans through BiG Business Loan Fund and Donbac Microloan Fund.

Finance Yorkshire has now taken on responsibility for providing gap finance in Yorkshire and the Humber.

For further details please contact Suzanne Tinkler,  on 0845 649 0000.

South Yorkshire Investment Fund Ltd is a company limited by guarantee (Registered No 3936065). South Yorkshire Investment Fund comprises three sub funds, the South Yorkshire Investment Capital Fund, the South Yorkshire Investment Development Fund, which are each managed by YFM Venture Finance Limited, and the South Yorkshire Investment Small Business Fund, which is managed by Finance South Yorkshire Ltd. YFM Venture Finance Limited (Tel 0113 294 5000) and Finance South Yorkshire Ltd (Tel 01709 386 377) are each authorised and regulated by the Financial Services Authority. South Yorkshire Investment Fund also provides a number of services, which are not regulated by The Financial Services Authority. These include the pilot Seedcorn Fund, BiG Business Loan Fund, Mentorbank and access to the Donbac Microloan Fund. BiG Business Loan Fund is managed by Donbac Ltd (company registration No. 01925556) and Key Fund Yorkshire Ltd (Tel 0114 242 8900).