ABL facility supports opening of UK’s first new major cheese production facility in 40 years
South Caernarfon Creameries (SCC) has recently opened its new cheese production unit. The new £7.5m cheese production unit was supported by an asset-based lending facility from Royal Bank of Scotland’s Asset Based Lending team and is the first major cheese production new build in the UK for 40 years.
The new build, which is located at the Creameries’ site in Chwilog, near Pwlhelli, was officially opened this summer – on 5 July by HRH The Prince of Wales and The Duchess of Cornwall.
It will enable the co-operative to increase annual cheese production from 9,500 tonnes to 11,500 tonnes and provides efficient, modern production facilities that support the Creameries’ growth strategy. The new production site has formed an integral part of strategic plans to climb the added-value ladder by improving its customer mix and delivering quality products and product innovation alongside its high quality bulk cheese and butter production.
This increased capacity will satisfy heightened demand. Earlier this year, the creamery announced that it had been awarded the contract to supply Sainsbury’s with their national Basics Cheese range. The contract includes 13 products across Sainsbury’s Basics range and will launch into store later this year. The creamery has further new supply contracts in hand, which will be announced later this year.
Alan Wyn Jones, managing director at SCC, said:
“Our new production facility is state of the art and a fantastic statement of the company’s intent for the future. The development has been a critical element of our growth strategy and will enable us to achieve best in class operating efficiencies and yields whilst meeting the growing demands from our existing and new customers.
“The asset-based lending facility that has supported the creation of the new site has worked well and has supported both our ongoing business activity whilst also contributing significantly to the development of the new factory. Paul Morgan from Royal Bank of Scotland has been a great partner throughout this challenging period and we are very appreciative of the great support he has given throughout this major investment process.”
Paul Morgan, corporate manager at Royal Bank of Scotland Asset-Based Lending, added:
“SCC’s new production facility is very impressive and a real game changer for the company and I am delighted that we have been able to support them through the project. The Royal official opening was a day of immense pride for the shareholders, management and staff of SCC and it was a pleasure to join them and share in their big day. The attainment of new long term supply contracts is testament to the strategic decisions made and I’m really looking forward to seeing the company reap its rewards.
“We have shared a strong working relationship with SCC since 2010 and alongside the Welsh government grant we were able to structure a bespoke asset based lending facility that has delivered the funding needed to finance the project. We are delighted to have been involved in this development and to be able to support SCC as it takes the next significant steps in its expansion.”
Funding to support the development has been provided by Royal Bank of Scotland’s Asset-Based Lending team through increased facilities and a new term loan. A significant grant from the Welsh government has also supported the development.
South Caernarfon Creameries is the largest and oldest dairy co-operative in Wales, owned by 130 Welsh member supplier farmers who are located in North Wales, Mid Wales and Ceredigion.
