Case study
Case study: Securing invoice finance to prevent HMRC winding up action
Background:
- Winding up petition imminent, creating significant financial pressure
- Over 40 jobs at risk if the business could not secure funding
- Immediate action required to protect operations and maintain stability
An aggregates supplier specialising in waste recycling received a winding up petition from HMRC. With publication in the Gazette imminent and a debt of approximately £360k to settle, swift action was critical.
The Approach:
The client was referred by their accountant to the Restructuring and Insolvency team at Leonard Curtis after discovering the winding-up petition was due to be made public.
Although the situation was challenging, the business had a strong track record of profitable trading. Following an initial discussion with Stewart Goldsmith, a director within Restructuring and Insolvency, it was believed that there was a potential for a funding solution to save the business, so a comprehensive pack was prepared to share with the funding team.
The funding team promptly conducted a thorough review of the full business and group structure, evaluating options such as property finance, unsecured lending, and working capital facilities. Although the client initially favoured a property loan, invoice finance was recommended as a faster, more cost-effective, and flexible alternative. This approach unlocked cash tied up in the debtor book, provided immediate liquidity, avoided/delayed leveraging property, and offered funding that scales with growth.
The looming winding-up petition posed a significant hurdle because it could affect a lender’s ability to perfect security. A lender who we could trust to deliver in difficult circumstances was sought.
Within four weeks, all documentation, audits, and onboarding for the new invoice finance facility were completed. At the same time, negotiations with the existing lender secured the release of security, and collaboration with Awaes Ali and Joe Douglas from the Business Advisory team helped discussions with HMRC to ensure they supported the client.
Through clear communication, proactive risk management, and strong relationships with HMRC and lenders, the facility was successfully secured. This achievement was only possible by utilising the wider business and fostering collaboration across multiple teams. By doing so, Leonard Curtis delivered the best possible result for the client, ultimately saving a business employing over 40 staff and settling outstanding liabilities.
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Leonard Curtis is a trading style of Reach Commercial Finance Limited, registered at Riverside House, Irwell Street, Manchester, M3 5EN. Company Register number is 09056450. Reach Commercial Finance Limited is authorised and regulated by the Financial Conduct Authority, FRN: 753686. Reach Commercial Finance Limited is an authorised credit broker and not a lender. We work with an unrestricted number of lenders to find a potentially suitable arrangement for your consideration. ICO registration ZA069234 and you can check via www.ico.org.uk. We will receive commission from lenders. Different lenders pay different amounts depending on different commission models. For transparency we work with the following commission models: fixed fee, fixed rate of commission, percentage of the amount you borrow and rate for risk (this is based on the risk profile of the business). Further details of the commission model, calculation and amount will be disclosed to you throughout your customer journey. Privacy notice.
Leonard Curtis Legal Limited is a limited company, registered in England and Wales with registered number 09820186. Registered office: Riverside House, Irwell Street, Manchester M3 5EN. Leonard Curtis Legal Limited is registered with the Solicitors Regulation Authority with number 626004.