Working Capital Finance for a Wine Estate

When a prestigious UK wine estate turned to their bank for additional working capital finance, they were met with a cold response. So, the estate owners were recommended to talk to R&BS to help them navigate other options in the finance market, and to get the funds they needed on the best rates and terms.

Mark and Sarah Driver have owned the 600-acre Rathfinny estate in East Sussex since 2010. Formerly an arable farm, the land was bought with the specific intention of creating a wine estate to produce some of the world’s finest sparkling wines. The climate, chalk soil and aspect make it the perfect site for a vineyard.​ The first 50 acres of vines were planted in 2012 and now stretch across 325 acres.

How R&BS helped

The estate needed additional working capital to help finance improvements. The funds would help to invest in the plant and machinery and provide provide further working capital. Mark Driver was recommended to talk to R&BS by a local land agent.

R&BS consultant, Graham Sanders, took on the case to help find the best deal. It needed to provide the working capital, refinance the existing debt from their current bank - leaving an overall requirement in excess of £6m - and provide a new day-to-day banking relationship.

Graham says, “It was a challenging case because it was forecast led and difficult to convince lenders that with stocks in hand and a known quality brand, Rathfinny could deliver the cashflow to service the borrowing. We were looking for a lender who understood that, and who would offer a long term commitment with a minimum of five years before a review.”

Graham put a detailed lending proposal, including detailed budgets and serviceability forecasts to over 10 banks – some from the high street, some private banks and some new alternative lenders. He had five positive responses from lenders, and the Drivers ended up going with a private bank who understood and were impressed by the Rathfinny business.

Graham continues, “This private bank was a good fit for Rathfinny and could provide the required support, and more additional funds than we had originally asked for. It was offered at a competitive rate on a five-year interest-only deal, with a commitment to extend and continue support beyond those five years. This bank and the new relationship manager will now support Rathfinny through the changes and into providing the return the owners seek.”

Mark Driver says,

“Graham introduced us to several potential lenders and we agreed to proceed with a private bank who, with Graham’s help, understood the risks and scale of the business opportunity. Graham’s experience in framing those arguments really helped us secure this financing.”

More about Rathfinny

Rathfinny has now grown a reputation for producing high quality Sussex Sparking wines that rival those across the world - and they sell through a distributor into a high-end market including The Savoy, Ritz, Dorchester, Mandarin Hotel, Connaught and numerous other restaurants and hotels. They also work with importers and distributors in Norway, Sweden, Denmark, Finland and Hong Kong. In addition, the Cellar Door shop on site, sells wines to visitors and fulfils e-commerce orders.

Expanding wine tourism is an important part of their plan to develop the Rathfinny brand domestically and internationally. Before Covid the estate attracted over 40,000 visitors per year. Opened in 2018, their fine dining Tasting Room restaurant was awarded a Michelin Plate in 2020. The Flint Barns Dining Room also provides locally-sourced food for visitors. In the centre of the vineyard, the Flint Barns provides 10 bed and breakfast rooms, and with an additional marquee, can host weddings and parties of over 150 people.

The estate also has 175 acres of contracted arable crops, 22 acres of grassland and 24 acres of woodland. The farm receives professional advice for the vineyard, farming, environment and grants and subsidies.

For more information about the Rathfinny Wine Estate, to buy their sparking wine or to book a visit, dinner or stay, please visit the Rathfinny website.

Requirement for vineyard finance is growing

As a relatively new industry for the UK, many banks and lenders don’t understand the methods and time involved in the winemaking process. This can make it hard for new, establishing or established wine estates, vineyards and wineries to get the finance they need.

We’re ahead of the bunch when it comes to viticulture! Our team have experience with vineyard finance, and can help communicate with banks and lenders and smooth the path to successful funding.

Read another R&BS Vineyard case study here