A government credit guarantee has allowed Teesside stainless steel alloy inventor and manufacturer Paralloy to secure up to £26 million of a Santander UK bank guarantee facility to support the continued growth of its export business.

Announced on National Manufacturing Day, the guarantee from UK Export Finance (UKEF) – the government’s export credit agency – allows Santander UK to overwrite a previous facility and increase the amount of facility available to Paralloy from £17 million to £26 million.

The previous facility enabled Paralloy to offer bonds on its contracts, assuring potential buyers that orders would be fulfilled even in times of market uncertainty. The newly agreed package means that the manufacturer can issue £9 million more in bank guarantees than before. This will allow Paralloy to pursue an even greater range of high-value export contracts and enter new markets, partly because the funding will help the business procure inputs whose prices have risen sharply amid global economic challenges.

Thanks in part to this facility, the company anticipates creating 75 new jobs by 2024, giving a boost to local, high-skilled jobs. This is UKEF’s second guarantee issued to Paralloy through its General Export Facility (GEF), the first of which helped Paralloy create more than 100 new jobs and drive export growth up by more than £30 million.

Launched by UKEF in 2021, the GEF product provides exporters with access to flexible financing. Now available through nine financial institutions, it provided support worth £325 million to UK exporters in 2022-23, making it UKEF’s most popular product.

Tim Reid, CEO of UKEF, said: “Working alongside Santander UK, we have increased our support for Paralloy, helping it further develop its export business and support highly skilled jobs in Teesside.

“This facility expansion shows that support which we offer through our General Export Facility is versatile and open to manufacturers in every corner of the UK who want to sell to the world.”

Founded more than 90 years ago, Billingham-based Paralloy produces patented stainless steel and nickel alloy castings used in high temperature furnaces and exports its products to more than 40 countries. Key markets include North America, Europe and the Middle East.

Paralloy supplies an industrial customer base which includes producers of blue hydrogen, direct reduction of iron used in steel manufacturing and Ethylene, as well as components for industrial gas turbines and defence.

Robert McGowan, CEO of Paralloy, said: “Getting hold of the funding to cover facilities and bonds is difficult as it ties up capital that can be used to invest in growing the company. UKEF General Export Facility – both this expansion and the original funding which it replaces – has been a gamechanger.

“It’s a vital tool that has enabled us to fuel the growth of our export sales, increase our investments, win bigger contracts and employ more people.”

Mark Ling, Head of Trade Finance & Supplier Finance at Santander UK said: “We are delighted to continue supporting Paralloy’s export journey alongside the support from UKEF. The General Export Facility offers crucial support to UK businesses, and we are pleased to work with UKEF to provide this funding to Paralloy and a growing number of other companies to help fulfil their international growth ambitions.”