County Durham precision engineering firm Ronco Engineering has received the first investment from a new £120m North East Fund to invest in new staff and machine tools.
The North East Fund is supported by the European Regional Development Fund.
Ronco Engineering has worked with NEL Fund Managers to secure a £250,000 investment from the North East Growth Capital Fund which will help it build the extra capacity required to successfully manage its growing order book.
Six new skilled posts are being created within the specialist production team at the Tanfield Lea-based business, taking the total workforce to 38.
Three new turning centres and new grinding equipment are being added to the factory floor, while premises improvements will ensure that enough power is available to service the extra equipment.
The Ronco management team is now aiming to use the extra capacity to win more new contracts and hopes to almost double the firm's turnover within the next three years.
Ronco Engineering offers the full spectrum of engineering services, from prototype design and CAD modelling through to final testing and manufacturing, and includes household names such as Caterpillar and JCB within its growing client portfolio.
David Steel, managing director at Ronco Engineering, says: "Over the last couple of years, we've spent a lot of time on business development activities which are now really bearing fruit with both existing and new clients.
"This investment will give Ronco a real shot in the arm and enables us to build the capacity needed to capitalise on the many interesting opportunities we've created with customers in the UK and Europe.
"The Growth Capital Fund offers the right commercial option for the business at this point and the highly professional NEL team's confidence in us adds even greater credibility to our business model."
The North East Growth Capital Fund has been designed to create over 800 jobs in more than 70 regional firms over the next five years and offers unsecured investments of up to £500,000 to established businesses looking to realise their growth potential.
It is one of two parts of the North East Fund being managed by NEL Fund Managers, alongside the £9m North East Small Loan Fund, and NEL is actively looking for potential investees from Tyne & Wear, Durham and Northumberland to put their investment ideas forward.
Dr Yvonne Gale, chief executive at NEL Fund Managers, adds: “Ronco Engineering presented a very robust case for investment and clearly demonstrated the positive impact that this capital would have on their future commercial development.
"Our investment mission is to start utilising these new funds as quickly and efficiently as possible, and we're pleased with the levels of interest that we're already getting from ambitious businesses across the region."
The overarching North East Fund will provide financial support for more than 600 businesses, creating around 3,500 jobs and delivering a legacy of up to £80m for further investment into the region.
Andrew Mitchell, chief executive of the North East Fund, says: "The North East Fund provides a fantastic opportunity for companies like Ronco Engineering to secure investment to accelerate growth, develop innovative products and services and identify new business opportunities that could lead to further job creation and expansion into new markets both at home and overseas.
“SMEs play a significant role in the regional economy and with the first investments now being made, the North East Fund can continue to support their ongoing development and success.”
For more information about NEL’s investment criteria, visit www.nel.co.uk
The photo above shows (from left) David Thomas, investment director at NEL, David Steel, managing director at Ronco Engineering, and North East Fund chief executive Andrew Mitchell