Startline targets growth after £292m London Stock Exchange-listed securitisation

Startline Motor Finance has completed a £292m London Stock Exchange-listed securitisation to fund growth and future-proof it with a move into electric vehicle (EV) funding.

The automotive finance provider floated around three quarters of its existing debt book under the name Satus – Latin for start – in order to open future funding sources.

Chief executive Paul Burgess said that the around 20 investors were attracted by the funding round, with a £400m sum set to be committed facility by global bank JP Morgan over the next 18 months among the successes.

Burgess said that Startline’s medium-term aim was to take the business’ market share from 2% to 3%, adding that the securitisation had placed it on a “sound footing to achieve this ambition”.

“The securitisation attracted around 20 investors and was significantly oversubscribed, which is something of a rarity and a testament to the quality of business that the team here in Glasgow is writing,” he added.

“Notably, we can now move into electric vehicle funding, which was closed to us under our previous funding arrangements, but is clearly a key element in future growth. The business is now in an ideal position to further expand.”

Last week the Finance and Leasing Association (FLA) said that global vehicle manufacutring issues were "hampering" the COVID-19 recovery of the car finance market.

In October it delivered a double-digit decline in volumes – to 166,077 – in a month which saw the Society of Manufacturers and Traders (SMMT) report a registrations decline of 24.6%.

Founded eight years ago, Startline is a specialist in near-prime motor finance and employs 160 people at its Skypark headquarters, in Glasgow.

It works with around half of the UK’s top 50 franchise dealers by turnover as well as 70% of the top 50 independent car retailers.

In August this year it launched the Startline Acadamy, a new remote learning platform to deliver training and wellbeing support to its staff in response to the rapid growth of remote working over the last year.

A month later it launched a new 'Insights' data product designed to maximise car retailers' finance opportunities.

Burgess said: “We have spent 2021 undertaking a number of initiatives designed to support our growth strategy.

“Importantly in the current market, investment in technology designed to support both dealers and car buyers, who increasingly purchase online, has continued.

“Also, we are keenly aware that retaining and attracting the right people has become more difficult now, and have launched a new training initiative, the Startline Academy, as well as providing mental health support to staff through our relationship with a company called Sanctus and app-based meditation through Calm.

“Additionally, next year, we are embarking on a programme of diversity and inclusion training, working with leading specialists, Vercida.

“We’re also conscious of our environmental responsibilities and will soon be revealing details of a new scheme to plant a tree for every motor finance deal we write, as well as other initiatives in this area.

“This thinking is very much in support of the used car market’s move towards electrification and a general shift towards a net zero future.”