Real Good Food to receive new funding from shareholders

UK-based bakery and ingredients group Real Good Food is set to receive additional funding from three of its major shareholders including Napier Brown Ingredients (NB Ingredients), Omnicane International Investors and certain funds managed by Downing.

The funding is the result of an agreement executed by the shareholders in the form of a Drawdown Notice of up to £4m in total.

Omnicane and NB Ingredients will each provide up to £1.713m, while certain funds of Downing will provide £0.574m.

The shareholders loan facility includes 10% annual interest, which is payable quarterly in arrears.

Real Good Food will be able to redeem the loan notice by 30 June 2018, or earlier upon certain events of default.

The new funding is expected to support Real Good Food’s working capital requirements.They are also anticipated to ease pressure on cash availability over the coming months and offer time to arrange longer term funding for the company.

Real Good Food chief executive Hugh Cawley said: “Today’s additional funding is an important part of meeting our short-term requirements, and further funding will be required for working capital and investment purposes in order to implement the Group’s business plan.

“The raising of these loan notes is part of the longer term funding plan being pursued by the Group.”

Real Good Food explained that its board is currently exploring the details of financing the company’s requirement, including the issue of new equity.

The company is a diversified food business catering to various markets including retail, manufacturing, wholesale, foodservice and export.