Tullis Russell secures £7.5m loan from Lloyds

Group Business Editor

Wednesday 31 October 2012

SCOTTISH paper-maker Tullis Russell Group, the employee-owned company that has stood firm through years of grim sector conditions, has secured a substantial funding package from Lloyds Banking Group.

BRIght FUTURE: Lloyds' Alasdair Gardner, left, and Tullis Russell chief executive Chris Parr.

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Lloyds said it was providing the Fife-based paper manufacturing and specialist coatings group with new "long-term" working capital facilities of £7.5 million, committed for three years. The bank said this would provide "a strong and secure platform for the business and its 730-strong workforce to drive its global development agenda forward".

A spokesman for Lloyds told The Herald that Tullis Russell's bank facilities had been split between Lloyds and Royal Bank of Scotland previously.He added: "The amount of working capital provided, and the duration of it, is considerably increased from what they had, jointly, before."The latest available accounts for Tullis Russell show the paper manufacturer bounced into the black in the year to March 2011 with a pre-tax profit of £2.42m, having made a loss of £949,000 at this level in the prior 12 months, as turnover rose from £156.4m to £177.5m. Lloyds quotes Tullis Russell's up-to-date annual turnover as £166m.Chris Parr, Tullis Russell chief executive, said: "It is far easier to plan ahead with the solid platform of this three-year committed facility. Straight away it gives us stability and the confidence to grow and maximise our assets."And we have some particular strengths. Our employee ownership structure lets us take a long-term view without the short-term pressures often imposed by external shareholders. That is reassuring for customers and suppliers."Mr Parr noted Tullis Russell and the paper-making industry had been through challenging times, but emphasised his company had outperformed many of its sector stable-mates.He said: "There have been some difficulties but paper-making has faced a variety of different challenges throughout our 203-year history. These challenges have helped to shape us and create a business whose people are driven to continuously improve and to innovate. "The global economic conditions during the past four years have been extraordinary by any standard yet we have managed to navigate these conditions better than most in our sector, where we are respected for the long-term partnerships we have with our customers and suppliers."Mr Parr added: " The key thing is that we have the financial stability to move on and I have to thank Lloyds, (which) has taken the time to fully understand our business and our sector and by so doing has been able to efficiently shape a facility to meet our requirements as our new sole banking partner."He cited ambitions for growth, both organically and through acquisition. Mr Parr highlighted the group's growth ambitions in its core European markets and its aim of securing more business in Brazil, Russia, India and China.Tullis Russell became employee-controlled in a groundbreaking buyout in 1994, having been a family business. It has manufacturing plants in Fife, at Bollington in Cheshire, and at Ansan in South Korea.Alasdair Gardner, managing director of Lloyds' wholesale banking and markets division in Scotland, cited Tullis Russell's expertise, strong customer base, and "clear and concise view of where and how they see their future".

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Tullis Russell secures £7.5m loan from Lloyds

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