Teesside steel company Paralloy
has secured a £15 million funding package from Santander UK
with an 80% guarantee from UK Export Finance
(UKEF) to support its export-led growth.
The guarantee is in the form of a UKEF General Export Facility (GEF), which is designed to help UK businesses easily access funding to cover the cost of international trade and help level up export opportunities for businesses across the UK.
Paralloy makes patented steel alloy castings used in high-temperature furnaces and exports 95% of what it makes in the UK to 70 overseas markets. Its exports have reached record levels of up to £50 million, and the firm required general working capital to fulfill record demand for its services.
As the country ‘builds back better’ from Covid-19, the funding package has enabled Paralloy to take on higher-value export contracts, open two new sites in Teesside, and create 76 highly skilled jobs. The firm has plans to hire a further 40 additional staff, including engineers, welders and fabricators this year.
Mike Freer, Minister for Exports, said: “It is great to see Paralloy boost its exports, creating more highly-skilled jobs in the North East. This support using UK Export Finance’s General Export Facility, shows how the Government can help local companies sell to the world helping to ‘level up and build back better than ever before’. UKEF has huge liquidity for exporters to tap into.
“Paralloy is one of only a handful of companies worldwide to produce these steel castings and is a key supplier to the blue hydrogen market, which produces virtually no greenhouse gas emissions and is much in demand as firms across the world transition away from polluting fossil fuels.”
Paralloy CEO Robert McGowan said: “This UKEF-backed funding package from Santander UK has enabled us to future-proof the business, and provided the working capital to fulfil bigger export contracts. It is truly been a game-changer, and we can now focus on building out our order book even more and hiring the right team to support that.”
Mark Ling, head of trade and supplier finance at Santander UK, said: “Paralloy has successfully navigated unprecedented challenges posed by the pandemic, growing its business significantly over the past 18 months. The GEF offers crucial support to UK businesses, and we are pleased to work with UKEF to provide this funding to Paralloy and a growing number of other companies to help fulfil their international growth ambitions.”
Ulviyya Huseynova, UK Export Finance Manager for North Yorkshire, Humberside and Teesside, said: “This is exactly what the GEF was designed to achieve: empowering a business to focus on its overall growth and unlock more export opportunities. With beginnings in the heart of the UK’s metal industry, Paralloy is now helping to power the fuel of the future with its specialist equipment and I am thrilled that we could provide the necessary support.”