StepChange Secures $11M Westpac Boost to Fuel Expansion

Strategic Financial Backing

StepChange Holdings Limited (ASX, STH), a specialist in enterprise resource planning (ERP) consulting, has secured a significant financial boost through new debt facilities arranged with Westpac Banking Corporation. The $11 million package comprises a $10 million three-year Bank Bill Business Loan and a $1 million Business Overdraft Facility, designed to provide the company with enhanced balance sheet flexibility.

This capital injection is a clear signal of confidence from Westpac in StepChange’s business model and growth prospects. The facilities are intended to underpin the company’s strategic growth initiatives, including funding permitted acquisitions and supporting ongoing working capital and capital expenditure needs.

Growth and Expansion Plans

StepChange’s Managing Director, Shane Bransby, emphasised the importance of this milestone, highlighting that the new facilities will accelerate the company’s national and international expansion. The company is targeting increased demand from Tier 1 clients across the energy, mining, and government sectors, markets that require sophisticated ERP transformation services.

StepChange’s core offering revolves around modernising and upgrading ERP systems, primarily using SAP software modules, to help clients streamline their business processes and improve operational efficiency. The new debt facilities will enable StepChange to pursue strategic acquisitions aligned with its growth strategy outlined at IPO, potentially broadening its service capabilities and market reach.

Facility Structure and Terms

The Bank Bill Business Loan is structured to allow multiple drawdowns within three months, providing flexibility to access funds as growth opportunities arise. Repayments will commence in the 2026 financial year, with interest rates tied to the 90-day bank bill swap rate plus a margin, currently around 4.55% per annum. The overdraft facility, revolving and at-call, supports day-to-day working capital and capital expenditure, with an indicative interest rate of approximately 6.19% per annum.

These terms reflect a disciplined approach to capital management, balancing the need for growth funding with prudent financial stewardship. The facilities also reinforce StepChange’s creditworthiness, an important consideration for investors and partners as the company scales.

Looking Ahead

While the announcement does not specify exact acquisition targets or detailed expansion timelines, the financial backing positions StepChange well to capitalize on emerging opportunities. Investors will be watching closely for subsequent updates on how these funds are deployed and the impact on the company’s market position and financial performance.