Manchester-based tool rental firm HSS Hire has secured a near £4m investment from CIP Merchant Capital.
The company has acquired, in aggregate, 25 million ordinary shares in the AIM-listed business, representing approximately 3.6% of its existing issued share capital, for a total consideration of about £3.9m.
CIP Merchant Capital is a closed-ended investment company incorporated in Guernsey in 2017.
In a statement, the buyer said: "The CIP board notes the strong track record of the leadership team at HSS, which it believes took appropriate and decisive action in response to the Covid-19 outbreak thereby enabling HSS to navigate the complexities of the first half of 2020.
"The CIP board further believes that the financial resources of HSS augmented by the significant capital raise completed at the end of 2020 and the implementation of a new operating model puts HSS in a position of strength vis-à-vis a very fragmented market with strong consumer demand, which is expected to increase further in the UK economy's recovery phase.
"For these reasons, whilst it is noted that HSS operates outside of the core target investment sectors stated within the company's investing policy, HSS nevertheless meets a number of the company's other key investment criteria in line with its investing policy and in the CIP board's view represents a strong opportunity to create shareholder value in line with its strategic objectives."
The move comes after reports in October 2020 that HSS Hire was looking to raise £54m from shareholders to pay off loans and keep its lenders happy.
That came after the firm announced plans to cut 300 jobs earlier that month.
