BTG secures refinancing for manufacturer supplying the defence sector

The Challenge

BTG were approached by a specialist manufacturer supplying the defence industry who, despite being profitable and with a significant growth pipeline, had begun to experience acute short-term cash flow pressures due to a key customer delaying payment. This created a liquidity strain causing a covenant breach and an inability to service existing debt. The National Security and Investment Act 2021 severely restricted viable buyer pools.

Our Approach

We initially launched a targeted M&A process approaching potential buyers but quickly recognised that a sale was neither achievable nor optimal given NSIA constraints and inadequate offer valuations. Pivoting strategy, our specialist refinance team generated multiple offers from the asset-based lending market, ultimately securing a partial refinance on competitive terms. Throughout the process, cash flow monitoring and stakeholder management was delivered along with the introduction of a Chief Revenue Officer. This integrated approach balanced immediate liquidity management with long-term capability building.

The Outcome

The refinancing enabled lump-sum repayment to the existing lender, bringing facilities back within terms without any equity dilution, preserving shareholder value in this profitable business. The CRO introduction and enhanced cash flow management delivered marked improvements to the company’s short-term liquidity position and overall financial controls, strengthening operational resilience.