Pump manufacturing firm Clydeunion Pumps has become the first beneficiary of the UK’s export credit agency ECGD’s bond support scheme.
HSBC arranged the deal which will allow the company to issue up to £25mn (US$41mn) of new bonding to fund a US$15mn contract to supply six water pumps to the Fuging nuclear power plant in South West China.
A Clydeunion spokesperson tells GTR that the deal was signed in early June.
The ECGD’s bond support scheme was launched at the end of March 2011 in response to a UK government trade and investment whitepaper.
Under the scheme, the ECGD provides partial guarantees to banks under a master bond support agreement.
The ECGD typically guarantees 50% of the value of a contract bond issued by a bank to support a UK export contract.
Furthermore, under the initiative the ECGD will cover up to 80% for advance payment and progress payment bonds.
“This new government-supported finance initiative means we now have bonding facilities, which allow us to compete more effectively on many similar projects in the future as we continue our rapid global expansion,” says Clydeunion Pumps executive chairman Jim McColl.
“It removes a limiting factor on our growth.”
The export contract also comes at a time when nuclear power is under the spotlight following the Japanese nuclear crisis.