A well-established family farm partnership was looking to diversify to reduce their reliance on their existing 300 acres of traditional arable cropping and were faced with crop price volatility, an unsupportive existing lender and forthcoming changes to the agricultural support system.
The family opted to erect a new 2,000 place pig finishing building and rear pigs on contract for a regional pig producer, thereby introducing a low-risk income stream, generating a strong return on capital and also providing benefits to the arable enterprise with slurry.
David Davenport at Carter Jonas as an AMC Agent was contacted by the family to assist with compiling a loan application to a new limited company for the venture together with refinancing the partnership’s existing borrowing.
Funding was secured for the project through the AMC over a term of 20 years on a combination of fixed and variable rates, whilst also including an initial capital repayment holiday to assist with the cash flow during the build process.
Whilst the investment was not insignificant the family are very pleased with the outcome and not only does the new investment provide an additional source of income, there are also significant synergies with the arable enterprise.