Literacy Capital has launched a new revolving credit facility (RCF) with OakNorth Bank, replacing its existing £30m facility, which was due to expire in December.

The new RCF has a three-year term which will expire in September 2027, providing the investment trust with up to £40m in funding.

Literacy said that £30m is fully committed, with an incremental £10m also available.

The firm said the RCF provides a “solid foundation” for it to continue making new investments and to support its existing portfolio.

Furthermore, the cost of the new facility is lower than the one that it replaces, whilst it also has greater flexibility, while the LTV financial covenant remains unchanged at 20%.

Chief executive officer at Library Capital, Richard Pindar, said: "We are pleased to agree a new debt facility for the fund, which will support Literacy and its investment activity over the medium term to continue delivering leading NAV performance and shareholder returns. It is testament to the maturity and growth achieved by Literacy that several competitive proposals were received from lenders, all of which offered more attractive terms than the original facility put in place in 2021.

"We are encouraged by the large number of high-quality founder-led businesses in the UK and we continually appraise these new investment opportunities. We also continue to assess options regarding re-financing or selling portfolio companies to generate cash and recycle capital into newer investments."

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