Loans totalling £10m from a fund set up by Tees Valley Unlimited in 2013 have helped boost the economy in the North East by £128m in the last two-and-a-half years.
Businesses across the North East are using short term loans (typically up to 24 months) from the evergreen Tees Valley Catalyst Fund, which is managed by FW Capital, to secure the advanced payment guarantees, performance and warranty bonds they need to win larger contracts.
Backed by the Tees Valley Catalyst Fund, 15 North East companies have already won new contracts worth £128m creating or safeguarding 645 jobs in the region.
With loan repayments and interest payments being ploughed back into new lending, the Fund is expected to help the region’s businesses secure £700m of new contracts and support 1,440 jobs in the Tees Valley by 2023..
Established local businesses like Wilton Engineering and Darlington-based Modus Seabed Intervention have already benefitted from the Fund, while an £825,000 loan to another Darlington-based company, Subsea Innovation took the total invested to date up to £10m.
Commenting on the impact the Tees Valley Catalyst fund is having, Neil Kenley, Director of Business Investment at Tees Valley Unlimited said: “This announcement is excellent news. The Tees Valley Catalyst Fund is encouraging local business confidence, creating and safeguarding jobs and has provided the local economy with a multi-million-pound boost.
“Impressive home-grown businesses like Subsea Innovation and Wilton Engineering have the potential to go on to even greater success and play an increasingly important role in the region’s prosperity. I’d encourage more businesses to understand how the Tees Valley Catalyst Fund can help them achieve.”
Joanne Whitfield, FW Capital’s Fund Manager in the North East added: “The Tees Valley Catalyst Fund is helping to strengthen the economy of the North East and has already paved the way to new contracts worth millions of pounds for local businesses.
“By helping more local businesses to finance the performance, warranty and other bonds they’re often required to provide we’re overcoming a significant financial barrier to growth. I’m confident that the Tees Valley Catalyst Fund will have an even greater impact in years to come as more ambitious local businesses think bigger.”
Northern Powerhouse Minister James Wharton said: “Local Enterprise Partnerships are changing the way we do business in this country by bridging the gap between the private and public sector. I am delighted the Tees Valley LEP is delivering a significant and visible impact through helping create jobs and delivering a multimillion-pound boost to the local economy.
Just this week the Communities Secretary announced that a fresh round of growth deals worth £1.8billion was up for grabs and I would urge Tees Valley LEP, amongst others, to get its proposals in to build on its good work.”Brian Thorpe, Head of Business and Corporate Bank for Barclays in the North East welcomed the announcement and said: “We work closely with FW Capital and the Tees Valley Catalyst Fund has been instrumental in unlocking finance facilities for a number of customers already. It’s excellent that the fund has contributed so much to the region supporting the local economy and contributing to employment opportunities.”
The Tees Valley Catalyst Fund was conceived in 2013 by Tees Valley Unlimited, the Local Enterprise Partnership for the area to provide companies with the finance to grow and prosper. Backed by Regional Growth Fund, in October 2014 the fund was widened to businesses across the North East and parts of North Yorkshire.
Subsea Innovation delivers multi-million pound contract with Tees Valley Catalyst Fund backing
Subsea Innovation, which designs and manufactures equipment for the off shore oil, gas and energy sectors, has used a loan from the Tees Valley Catalyst Fund to secure an advanced payment guarantee issued by Barclays for a major contract with RasGas in Qatar, one of the world’s premier integrated liquefied natural gas (LNG) suppliers.
The contract will see Subsea Innovation design and build a series of structural pipeline repair clamps and connectors which RasGas will use in its operations.
Managing Director, Martin Moon explained the significance of the new contract to Subsea Innovation’s future: “Subsea Innovation is a global business and leader in the design and manufacture of sophisticated marine engineering solutions. We recently moved to larger premises in Darlington giving us the capacity to take on larger projects.
“The RasGas contract is one of the largest contracts we’ve won to date and an important step forward for Subsea Innovation as we’ll be able to demonstrate that we can deliver clamps and connectors of this size to a major operator. The Tees Valley Catalyst Fund loan has been instrumental in helping us move up a gear and we’re confident that we can now build on these foundations.”
Nicky Atkinson, who led on the deal for FW Capital, said: “Subsea Innovation is an impressive company with an excellent track record. It’s also a leader in its field and I’m pleased our loan is helping Martin and his team to deliver this important contract for RasGas. I’m sure it will help them to cement their leadership position.”
Established in 1985 by a team of experienced engineers and diving professionals, Subsea Innovation operates globally.
The company offers an extensive range of products, including offshore equipment handling systems, pipeline repair and recovery systems as well as subsea sealing systems. Subsea Innovation also offers technical support to install its products and provides a full support and maintenance service.