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Ilchester Cheese, a Somerset-based blended cheese producer, has completed an undisclosed re-financing.

The funding was provided by Inflexion Private Equity, which made its first investment in the business three years ago when it backed a management buy-out of the company.

Inflexion’s funding was complemented by £5 million of debt and working capital provided by Lloyds TSB.

The re-financing is part of Inflexion’s commitment to increase value and maximise growth opportunities in its portfolio companies.

The firm’s earlier investments in the business have supported its manufacturing operations, new product development and expanded its sales and marketing team. These developments have been reflected in the company’s growing revenues and expanding international reach.

The transaction was led by Inflexion director Iain Jamieson, who is also a non-executive director of Ilchester.

Inflexion’s managing partner, John Hartz, said the firm is constantly looking for ways to help its portfolio companies realise their optimum potential. “This re-capitalisation provides an excellent supportive package for the company’s future growth plans, lowers its cost of capital and provides some early return for our investors. It would not have been possible but for the efforts of the Ilchester team in growing the business.”

This re-financing follows recent deals by Inflexion including its investment in clothing retailer Jack Wills and the £25 million buy-out of Aspen Pumps, a manufacturer of air conditioning pumps.

Last year the firm included the buy-outs of Tekton, Autocruise, Parasol and Viking Moorings among its deals. It also realised its investments in ACIS and Crown Sports as well as raising £165 million.

Lloyds TSB’s funding was co-ordinated by corporate finance director Gavin Reid and Peter Anderson of the bank’s commercial Finance division.

“Ilchester Cheese is an excellent business with a strong management team and is well positioned to increase its UK and export sales, given its investment in new products which are now coming to market,” Reid said.

Inflexion was advised by SJ Berwin, while Ilchester was supported by Burges Salmon with the Bristol office of Grant Thornton providing the financial due diligence.

Ilchester Cheese was founded in 1962, and now produces more than 50 blended cheeses in the UK, which are also exported to 20 countries.

In the UK it supplies major supermarkets, independent stores, wholesalers, food manufacturers as well as sandwich and catering companies with pre-packed and deli counter cheese. Its brands include Applewood, Mexicana and Five Counties.

Inflexion specialises in the UK’s sub-£50 million buy-out market, making equity investments of between £5 million and £20 million.

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