Glasgow-based utility meter supplier Smart Metering Systems (SMS) has secured a £45 million loan facility – more than doubling its existing funds – on the back of a string of major contracts.
The company, which has seen its share price almost triple since it joined Aim last year, has been provided with the loan facility by Barclays, Clydesdale and Lloyds. It replaces an existing £19.5m arrangement with Clydesdale.
The deal follows a number of major new contracts in recent months, plus growth in the firm’s existing customer base.
SMS said it plans to use the facility to fund the purchase of meters to install on behalf of customers over the next 24 months.
Chief executive Alan Foy said: “I am delighted in the substantial interest shown by the UK banking community in what was a highly competitive process. The company was able to negotiate a substantial increased facility with extremely good rates.”
Together with existing funds and remaining cash proceeds from the flotation, the company now has more than £55m to invest in metering assets over the next 24 months.
SMS buys and installs meters on behalf of major utilities and receives a rental income over the life of the meter, typically around 25 years.
The company also announced that an automated meter reading device it has developed has been granted received full European patent approval.
Recent contract wins for the company include a deal with Perth-based utilities giant SSE to run its gas meter operations in the UK, apart from in Scotland and the south-east of England, replacing a rival firm. The deal will give SMS a much larger share of the domestic market.
Shares in SMS closed down 0.5p at 177p yesterday.
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